Exhibit 17.1
USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S) $$\begin{array} { c c c c c c c c c }
\text { Company } & \text { Ticker } & \text { Coupon } & \text { Maturity } & \begin{array} { c }
\text { Last } \
\text { Price }
\end{array} & \begin{array} { c }
\text { Last } \
\text { Yiel }
\end{array} & \begin{array} { c }
\text { EST } \
\text { Spread }
\end{array} & \text { UST } & \begin{array} { c }
\text { Est } \$ \text { Vol } \
( 000 \text { s) }
\end{array} \
\hline \text { Gen Elec } & \text { GE } & 4.75 & 9 / 15 / 2019 & 99.544 & 4.808 & 62 & 10 & 158736
\end{array}$$
-Refer to Exhibit 17.1. What is the capital gains/loss yield on this bond?
A)-0.038%
B)0.456%
C)0.038%
D)-0.456%
E)None of the above

Question

Exhibit 17.1
USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S) $$\begin{array} { c c c c c c c c c } 
\text { Company } & \text { Ticker } & \text { Coupon } & \text { Maturity } & \begin{array} { c } 
\text { Last } \
\text { Price }
\end{array} & \begin{array} { c } 
\text { Last } \
\text { Yiel }
\end{array} & \begin{array} { c } 
\text { EST } \
\text { Spread }
\end{array} & \text { UST } & \begin{array} { c } 
\text { Est } \$ \text { Vol } \
( 000 \text { s) }
\end{array} \
\hline \text { Gen Elec } & \text { GE } & 4.75 & 9 / 15 / 2019 & 99.544 & 4.808 & 62 & 10 & 158736
\end{array}$$
-Refer to Exhibit 17.1. What is the capital gains/loss yield on this bond?
A)-0.038%
B)0.456%
C)0.038%
D)-0.456%
E)None of the above

Quizplus · Accepted Answer

The capital gains/loss yield is calculated as the difference between the last yield and the EST spread divided by the last yield. In this case, the capital gains/loss yield is (4.808% - 62%) / 4.808% = -0.038%.

Exhibit 17 -Refer to Exhibit 17