This is very helpful and I am close to understanding the PV calcs. These numbers match my spreadsheet almost exactly, but I am using the calculated value using an APR of 4.212% instead of the YTM of 4.5708%. This is my formula replacing line 9 and following:I suggest using the market value. But if you want to value them at the initial yield, here's how you could do it. You'd need to do something like this in order to amortize the bond premium. This uses the Excel PV function.Code:
Row Col A Col B Formula in Column B 2 Years 10 3 Coupon 7.50% 4 Principal 16,000.00 5 Cost 19,728.27 6 YTM 4.5708% =2*RATE(B2*2,B4*B3/2,-B5,B4) 7 Periods Present 8 Remaining ValueCode:
9 20 19,728.27 =-B$4*PV(B$6/2,A9,B$3/2,1,0) 10 18 19,426.60 | | | 11 16 19,110.98 | | | 12 14 18,780.78 | | | 13 12 18,435.30 | | | 14 10 18,073.86 | | | 15 8 17,695.71 | | | 16 6 17,300.07 | | | 17 4 16,886.14 | | | 18 2 16,453.08 v v v 19 0 16,000.00 =-B$4*PV(B$6/2,A19,B$3/2,1,0)
= ((B$5*b$6)*(now()-enddate)/365.25)+B$5-interest_rcvd_to_date
where enddate = 8/31/2035
Oddly, using 4.5708% gives an extra $600 over the 4.212% if I am correct. It's like it has an extra interest payment when treating it like a bank would. It is a loan I'm giving GE, right? So why isn't the APR of 4.212% correct for my purposes?
I'm not trying to be contrarian and I know I'm still learning about bonds and how this stuff works.
I think I'm tracking at a level most sane investors don't worry about. But I didn't say I was sane.
When I was a kid I tracked on paper how many times I heard every song I liked on the radio. I had demo derbies with my hot wheels cars and tracked the winner ratio. Some of this is to feed my personality in retirement and I enjoy it.Statistics: Posted by McPherson614 — Fri Dec 05, 2025 2:10 am — Replies 6 — Views 605