Yield Curves
Description
A yield curve is a line that plots the interest rates, at a set point in time, of bonds having equal credit quality but
differing maturity dates.
The shape of the yield curve gives an idea of future interest rate changes and economic activity. An inverted yield
curve is often a harbinger of recession. A positively sloped yield curve is often a harbinger of inflationary growth.
The information content of a yield curve reflects the asset pricing process on financial markets. When
buying and selling bonds, investors include their expectations of future inflation, real interest rates
and their assessment of risks. An investor calculates the price of a bond by discounting the expected
future cash flows.
The course covers key features of yield curves
is issued on the Luxoft Training form
Objectives
To provide the audience the basic understanding of yield curves and how they can be constructed
Target Audience
Testers, System and Business Analysts, Architects, Developers, and Project Managers working on corporate finance
projects
Prerequisites
FIN-001 Introduction into Financial Markets
FIN-023 Introduction into Derivatives
FIN-003 Basics of Financial Markets. Money market and interest rate derivatives
FIN-005 Basics of Financial Markets. Fixed Income and Fixed Income Derivatives
Roadmap
Yield Curves: purpose, shapes, types
Yield Curves Construction