One company has two outstanding publicly traded bonds. The two bonds will both m
ID: 2774485 • Letter: O
Question
One company has two outstanding publicly traded bonds. The two bonds will both mature in ten years and have the same coupon rate. One of the bonds has a sinking fund; the other one does not. Which bond will have the higher yield to maturity today?
The bond with the sinking fund
The bond without the sinking fund
It depends on the shape of the yield curve
Both bonds will have the same YTM because they were issued by the same company
The bond with the sinking fund
The bond without the sinking fund
It depends on the shape of the yield curve
Both bonds will have the same YTM because they were issued by the same company
Explanation / Answer
Both bonds will have the same YTM because they were issued by the same company
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