Bonds and bank deposits
Understand debt, prices, yields and risk through synthetic rouble examples, then compare bonds with a deposit under explicit assumptions.
Lessons
What is a bond?
10 min
Separate the principal lent to an issuer from coupon income and the price paid today. A synthetic annual bond illustrates the timing of payments and the risk that an issuer may fail to pay.
Bonds and deposits
11 min
Compare a bank deposit with government-style and corporate bonds. Examine insurance boundaries, liquidity and issuer risk before treating instruments with different protections as interchangeable.
Price and accrued interest
10 min
Distinguish a clean quote from the dirty purchase price. Calculate accrued coupon interest and whole bond quantities, keeping transaction fees and unused cash in the purchase budget.
Understanding yields
11 min
Distinguish the coupon rate, current yield and yield to maturity. Discount the contractual cash flows and examine the reinvestment and holding-period assumptions behind a model yield.
Interest rates and duration
11 min
Explore how bond prices respond to changes in required yields. Compare full repricing with a local duration approximation and understand why the approximation becomes less reliable for larger changes.
Default and diversification
10 min
Model a partial recovery after an issuer default and compare concentrated exposure with several issuers. Diversification can reduce one issuer’s impact while leaving market and other shared risks.
Brokers, taxes and investment accounts
12 min
Review the steps between an order and ownership, including settlement and costs. Identify the Russian tax and investment-account rules that require current source checks and personal circumstances.