clean price

(noun)

the price of a bond excluding any interest that has accrued since issue or the most recent coupon payment.

Related Terms

Examples of clean price in the following topics:

  • Other Features

    • It usually refers either to the current yield, which is simply the annual interest payment divided by the current market price of the bond (often the clean price), or to the yield to maturity or redemption yield.
    • The price can be quoted as clean or dirty.
    • "Dirty" refers to the actual price to be paid; while "clean" includes an adjustment for accrued interest.
    • Price of puttable bond = Price of straight bond + Price of put option
    • Price of a puttable bond is always higher than the price of a straight bond because the put option adds value to an investor.

  • Defining the Business Mission

    • McDonalds - "To provide the fast food customer food prepared in the same high-quality manner worldwide that is tasty, reasonably-priced & delivered consistently in a low-key décor and friendly atmosphere. "
    • Courtyard by Marriott - "To provide economy and quality minded travelers with a premier, moderate priced lodging facility which is consistently perceived as clean, comfortable, well-maintained, and attractive, staffed by friendly, attentive and efficient people"
    • Distinction: consistently perceived as clean, comfortable, well-maintained, and attractive, staffed by friendly, attentive, and efficient people.

  • Supply Reduction

    • Both subsidies and price ceilings are common and affect the overall supply and demand equilibrium points in the market.
    • One of the largest risks in this industry, due to the high degree of subsidization, is 'dumping. ' Dumping is the process of selling undervalued goods in another market, upsetting price points and equilibrium.
    • Other concerns revolve around dramatic soil damage due to short-term yield increasing strategies, growing immunity to pesticides, loss of rural space for farming (due to urbanization), and availability of clean water for irrigation.
    • All of these factors may reduce the aggregate supply and thus drive up prices. demonstrates rising food prices, perhaps from a number of the supply reduction factors discussed in this atom (or potentially unidentified factors).
    • Food prices over time, particularly in recent years, are demonstrating a trend upwards that may reflect a reduction in overall efficiency of agricultural production or reductions in supply.

  • Calculating Yield to Maturity Using the Bond Price

    • The yield to maturity is the discount rate that returns the bond's market price: YTM = [(Face value/Bond price)1/Time period]-1.
    • The yield to maturity is the discount rate which returns the market price of the bond.
    • YTM is the internal rate of return of an investment in the bond made at the observed price.
    • If the yield to maturity for a bond is less than the bond's coupon rate, then the (clean) market value of the bond is greater than the par value (and vice versa).
    • With 20 years remaining to maturity, the price of the bond will be 100/1.0720, or $25.84.

  • Evaluating Policies

    • Water:Access to clean, potable water is a basic necessity to which not everyone has access.Effective sewage systems for irrigation and effective water treatment for sanitation are a required input, and must be provided via governmental centralized infrastructure.
    • Subsidies: The government can utilize subsidies to reduce price points and increase the overall supply within a system .
    • Price Floors/Ceilings: Price floors provide a minimum price point for a given product while price ceilings create a maximum price point.
    • These are used to ensure appropriate pricing in a given industry (see ), and are often used in agriculture to control price points.
    • This is useful in controlling food prices, reducing waste, enabling efficiency and avoiding biosecurity issues.

  • Another twist: capitalizing on guilt

    • For example, some airlines will voluntarily add a few dollars to the price of their tickets and several power companies provide the option of paying a higher monthly fuel bill to help offset carbon emissions.
    • In other examples, Range Rover automobiles offered an emissions offset for the first 45,000 miles (72,000 kilometres) which was factored into their purchase price and a ski resort in Vail, Colorado, once enticed skiers to buy energy credits to help buy a wind turbine so in the future the skiers will be carbon-neutral when they are lifted to the top of a nearby mountain.
    • Of course, the money raised for carbon credit programs is supposed to be used for building or promoting environmentally friendly projects such as the planting of trees, the protection of forests, the funding of alternative energy program or the instigation of a pollution clean-up campaign – and, according to the World Bank, approximately $100 million is given on behalf of customers every year for these purposes.
    • Money invested in environmental clean-up campaigns has also been called into question (particularly campaigns that have already been paid for) and carbon credits have been repeatedly sold to scores of different buyers.

  • Putting together a clean production line

    • Is the full life-cycle cost of the machine being considered rather than its purchase price?
    • When buying equipment or machinery, remember that there are always two price tags.

  • Are solar voltaics right for your business?

    • For example, calculations for concentrated solar power, which uses mirrors to concentrate sunlight onto a fluid-filled container to produce steam that drives a turbine, is cost-equivalent to oil priced at $50 per barrel (before payback) – or as low as $20 per barrel (before payback) when the technology is scaled up.
    • (Seager, Ashley, ‘Alternative Fuels: Now It's a New Game and Clean Energy is No Longer a Dream', The Guardian) For more information about solar power visit www.solarserver.de and click on the English translation icon at the top of the home page.

  • Energy and Environmental Reform

    • In April of the same year, President Carter began a phased deregulation of oil prices.
    • At the time, the average price of crude oil was $15.85 per barrel (42 US gallons (160 L)).
    • After 1980, oil prices began a 20-year decline down to a 60 percent price drop in the 1990s.
    • While the regulated price of domestic oil was kept to $6 a barrel, the world market price was $30.
    • On December 11, 1980, he signed into law "Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA)" commonly known as Superfund, a United States federal law designed to clean up sites contaminated with hazardous substances.

  • Yield to Maturity

    • Yield to maturity is the discount rate at which the sum of all future cash flows from the bond are equal to the price of the bond.
    • The Yield to maturity (YTM) or redemption yield of a bond or other fixed-interest security, such as gilts, is the internal rate of return (IRR, overall interest rate) earned by an investor who buys the bond today at the market price, assuming that the bond will be held until maturity, and that all coupon and principal payments will be made on schedule .
    • Yield to maturity, rather, is simply the discount rate at which the sum of all future cash flows from the bond (coupons and principal) is equal to the price of the bond.
    • If the yield to maturity for a bond is less than the bond's coupon rate, then the (clean) market value of the bond is greater than the par value (and vice versa).
    • Yield to put: same as yield to call, but when the bond holder has the option to sell the bond back to the issuer at a fixed price on specified date.