Bonds can be divided into floating rate bills, fixed rate bonds and accumulated rate bonds according to different pricing methods of interest rates, among which floating rate bills and fixed rate bonds are the two most common pricing methods.
Fundamentally speaking, both of them are bonds, which have the properties of bonds. The pricing method of interest rate is the fundamental difference between the two. Under the condition of the same issuer and holding period, different pricing methods lead to different expected returns.
For example, a company issues three-year floating-rate bills and ordinary fixed-rate bonds at the same time, each of which is 654.38 billion yuan, of which the floating rate is 40% of the current interbank lending rate and 60% of the expected income of China Bond 500 Index. The expected annualized return of fixed-rate bonds is one year later, and the Shanghai Interbank Offered Rate is 6%.
Expected yield of floating bonds = Shanghai Interbank Offered Rate *40%+ expected yield of China Bond 500 Index *60%.
Expected yield of floating bonds of the company =4% * 40%+6% * 60%= expected yield of ordinary fixed bonds of the company. Comparatively speaking, the expected yield of floating rate bills is higher than that of ordinary bonds.
In the actual operation process, it plays a decisive role in the final expected return of floating rate bills by comprehensively judging the components of its reference expected return. Tips: Financial management is risky, and investment needs to be cautious.