The Term Structure of Interest Rates: Spot, Par, and Forward Curves
Free CFA Level I lesson in Fixed Income. 12 min read, ~1,803 words.
Spot rate = yield on a zero-coupon bond maturing at time; the spot curve plots across maturities and is the foundation of term structure. A bond's price equals the sum of its cash flows each discounted at the spot rate matching its own maturity; a single YTM only compresses that...
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What this lesson covers
- Content
- Example 1
- Example 2
- Common Mistakes
- Check Your Understanding
- Exam Shortcuts
Learning objectives
- term structure spot par forward
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