Tuckman chap1 DF and notation

[Reinie]

Hi,

It's basic but I dont get how to caculate the Discount factor for more than one leg.
for 1.0 or 1.5 etc.. on page 5. Missing something trivial... For 0.5 yes it's straight forward, once you understand what 7 7/8 or 12.7/32 means...

Like for maturity 1.0 I dont get the 0.9525

Thanks

 

[Reinie]

Never mind I found the spreadsheet (in the review bundle...) with the formulas..

You have to substract the coupons already paid (with the discount factor) from the present value.