Hi there,
I was playing around with the formulas for Malz's minimum spread and the implied yield:
Malz min sread:
(1-PD)*(1+r+z) + PD(RR) = 1+r
Implied yield:
y =[ (1+r)/{(1-PD) + PD(RR) } ] -1
As they essentially use the same inputs I thought perhaps it was possible to arrive at one...
This site uses cookies to help personalise content, tailor your experience and to keep you logged in if you register.
By continuing to use this site, you are consenting to our use of cookies.