Inside the Yield Book: The Classic That Created the Science of Bond Analysis, 3rd Edition

Chapter 4

The Yields of Premium Bonds, Par Bonds and Discount Bonds

As a result of the extraordinarily wide two-way fluctuations of bond yields over the last few years and the heavy volume of new corporate bond issues that have come out at different levels of the market, the investor today has available to him a much larger selection of high-grade seasoned corporate bond issues than ever before. Coupons range from 2⁵/₈ percent up to 9½ percent for issues of uniform high quality and long maturity. Offering prices recently ranged simultaneously from 60 up to 115. Yields of essentially similar credits ranged from 6.50 percent up to 8.25 percent. These differences were attributable largely to difference in coupons. Therefore, the question of whether ...