PAR YIELD CURVE
Par Yield Curve: translation
A graph of the yields on hypothetical Treasury securities with prices at par. On the par yield curve, the coupon rate will equal the yield-to-maturity of the security, which is why the Treasury bond will trade at par.Deriving a par yield curve is a step toward creating a theoretical spot rate yield curve, which is then used to more accurately price a coupon-paying bond. A method known as bootstrapping is used to derive the arbitrage-free forward interest rates.
- par yield curve—par yield curve translation Seeu yield curve. American Banker Glossaryu...Financial and business terms