I had dinner with a relative yesterday and had a good conversation with my cousin. When I was excited to tell me that I had made money by selling a bond recently, I muttered to myself. After pinching and calculating, he bought at an annualized rate of about 5%, with a term of 2 years. When he saw that the interest rate had dropped to 3% recently, he sold it with a face value of 100 yuan.

And my mother's friend, following my little nephew's advice, put his money into a certain bond, saying that he should be able to beat inflation. I pinched and calculated that the annual rate of debt was about 2.34%. Aunt, you'd better listen to me and buy something else.

As a 30-year-old creditor, I have witnessed too many situations of blind trading, so I decided to write this article for my brothers and sisters to popularize science.How can bond yield be earned?Primary school math is enough. Yes, at least don't lose money.

First of all, where do bond yields come from?

Remember that the bond returns of the three swordsmen, the first is the interest, the second is the spread, and the third is reinvestment, respectively:

Fixed interest: bonds never bully honest people

Actually, it's in front.Popular science textAs I have said, bonds are based on face value, coupon rate and maturity date. Once the bond is issued, the coupon rate will remain unchanged, and the cost (face value) + interest will be received on the maturity date, and the corresponding future income is fixed. So brothers and sisters who are insensitive to the market will be loyal after buying bonds for a year, and if they can't help themselves, don't be driven away by sluts with higher interest rates. no, no, no.

Low suction and high selling: an enviable price difference

The coupon rate is fixed, but in real life, the interest rate of bonds issued at different times will fluctuate and the price will ride the roller coaster accordingly. At the beginning, my cousin sold it when he saw the high price. No, the change in interest rate is the change in interest rate. How can I know how much the price is even?

First of all, let go of confusion. It is necessary to be clear about investment. Time is valuable. For instance.

I thought to myself, he took the top three in the exam when he was a child, so you don't have ACD numbers in your mind?

A person will not get rich for no reason, the power of time can be reflected in [now]. As a saying in the textbook: "the value of any asset is determined at a discount on the basis of the cash income that investors expect from the asset." "

Ok, calculate the current value from the uncle, and start to fight monsters:

• Level1It's the same primary school formula.

Take on the previous situation"present value"Is the future divided by the interest rate you will get in a year. It is very handy to deal with the vagaries of "market interest rates". First of all, let's take a look at treasury bonds and see how market interest rates fluctuate over the course of the year:

For example, if a little sister holds an one-year bond with a face value of 100, the interest rate is 10% when she buys it, and the interest rate immediately rises to 20%. How much should she sell without losing too much? The present value = 100 (1 / 10%) / (1 / 20%) = 91.6, and the debt is only worth 91.6 yuan. Just sell it on this basis.

For example, if a younger brother holds an one-year bond with a face value of 100, the interest rate is 10% when he buys it, and the interest rate immediately falls to 5% (in high spirits). Congratulations to this little brother, you don't have to sell it to make a profit. If you want to sell, the present value = 104.7 (11010%) / (11.5%) = 104.7, please sell more than 104.7 if you want to make a profit.

The clever brother also found outThere is an inverse relationship between interest rate and price.Because the debt with high interest rate is more valuable to others.

• Level2If the market interest rate changes and you want to sell for less than a year, add the time factor:

Brother who is good at math, put away the picture:

For example, the face value is 100 yuan, the coupon rate is 10%, and the term is 365 days, but you only buy it for 100 days before you want to change hands. At this time, the market interest rate is 5%. The present value calculated by the formula is about 106 yuan, which is equivalent to the value of 106 yuan you have on hand. Don't sell it lower than this.

• Level3The above situation is equivalent to an equivalent exchange, and you have been told about the profits of others. But in real life, it's not that easy to buy a pork (smile. All the factors that can affect the price are shown in the table:

For example, in July 2007, the central government announced that it would raise the benchmark interest rate and substantially reduce the interest tax policy. After that, China's bond market fell. I am the one who changed the two policies.Base interest rate. The interest tax has been reduced from 20% to 5%. Of course, everyone wants to redeposit in the bank. The demand for bonds is reduced, the supply exceeds the demand, and those who want to resell are forced to cut prices. Sisters who do not understand, please open the first chapter of political compulsory course in high school, the description of the buyer's market.

For novice sisters, you just need to keep in mind that the price is calculated at present value in level1. If you can't learn the most basic operation, Uncle can only be ¥%. & * #

No, I'm not mad. Because there is still someone who can help you-buy bond funds directly, you know, many app will show the rise and fall of the fund, it is clear whether it is up or down:

Reinvest: divorce! Find a better wife.

After selling the previous bonds, invest in a preferred bond with interest, that is, reinvest.

For this, the answer in my heart is: you can vote whatever you like, really. But remember:Be sure to find someone with a higher interest rate than the one you have in hand in order to bring higher returns.Otherwise, the interest rate would fall from the previous 7% to 6%, and now the selling would be a complete loss.

However, it is certainly risky to have a new wife. The market interest rate is often not something you can control and can find if you want to find a higher interest rate. Exactly how to avoid these risks, the next uncle will teach you (acting cute.

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Uncle asked you, do you remember what you learned today?

No, what you have learned is that in order to avoid losses, a rational investor must establish two concepts:

First, time is valuable, and any expected future income should be counted as existing value.

Second, no matter what kind of business you do, don't be too arbitrary. Interest rates are a double-edged sword that will hurt you as well as make you.

For more debt-based popular science knowledge, please pay attention to the column "playing with the bond market".