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arof
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Joined: 08 Nov 2004
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 Posted: Sep 24, 2013 10:46 am Post subject: Help - math calculation and interest rates |
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So I need to know what the approximate yield on a 50 year T-bill (if there were such a thing). How do I take the yields at 1 month, 3 months, 6 months, 1 year, 3 year, 5 year, 7 year, 10 year, 20, and 30 year and use them try to figure out what a imaginary 50 year t-bill rate would be at?
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eich82
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Joined: 13 Jan 2003
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City: MTP
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| Posted: Sep 24, 2013 11:30 am Post subject: Re: Help - math calculation and interest rates |
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| arof wrote: | | So I need to know what the approximate yield on a 50 year T-bill (if there were such a thing). How do I take the yields at 1 month, 3 months, 6 months, 1 year, 3 year, 5 year, 7 year, 10 year, 20, and 30 year and use them try to figure out what a imaginary 50 year t-bill rate would be at? |
Well you could take a look at the yield curve and try to project that out to a 50 year. At the end of the day, it's completely hypothetical, so there's not really a right or wrong answer. If I had to take an educated guess, I'd say you're looking at somewhere around 4.20-4.30% based on the current yield curve. Probably towards the lower end of that range since the slope of the curve would/should theoretically flatten as you get into the longer ranges of maturity. |
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chavez
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Joined: 22 Sep 2003
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City: Roseville
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| Posted: Sep 24, 2013 11:36 am Post subject: |
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T-Bills are sub 1-year. I think you mean a bond?
Anyhow, this site has instructions on a decent how-to-excel-calculator if you want to run hypotheticals.
http://www.wikihow.com/Calculate-Bond-Yield-in-Excel
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chavez
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| Posted: Sep 24, 2013 11:53 am Post subject: |
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NM, I just realized what you are trying to do.
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arof
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City: Toronto
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| Posted: Sep 25, 2013 9:01 am Post subject: |
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I came up with something that was close enough for my purposes - thanks.
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