Why par yields are the best interest rate measure

[@acidishot2]

Nice! Hope you keep posting more videos again 👍

[@bionicturtle]

Thank you for the support!

[@MikFrey]

Super video! It was very well explained :)

[@vitaliirudko2706]

Great lecture, thanks!

[@jamesbailey5008]

Thank you, is that rate nominal or effective?

[@tchesarebordjia6180]

Great Explanation!

[@WasteSecond]

8:57 -> why par rates are the best in Bionic Turtle's View

[@dodgingdurangos924]

Someone please help me out here. So par value is a.k.a. face value, principle value, or future value or what? And then is the par yield same as a rate (coupon rate?) that makes the sum of cash flows equal to face value? Or is the par yield analogous to IRR- the rate that makes NPV equal to zero?

[@karenkong1437]

1. Par value and principle value is the same. 2. Par yield is a hypothetical coupon rate that makes the sum of the PRESENT cash flows equal to face value. 3. I don't think par yield is analogous to IRR. We are using different spot rates for different coupons here.

[@sabriath]

I still don't get it....from what I can tell by the words alone, you are saying that the par rate is better, but how is getting less money better? You are paying $100 for a coupon to get some of that money back per year and in-so-doing you get less interest on the rate of the reserved note and then you get the "original" back but you multiplied it by the anum, which is a reduction of the actual put forward....all-in-all, it's less than you would have gotten just having a CD go full to end because of exponentiation. I know I'm dumb when it comes to bonds, they are a wildly retarded setup to be honest for markets and could easily have a much more intuitive design...but they went with this weird par and yield garbage that just confuses everyone. Plus, I make 40% per year average over the last 20+ years on the stock market, so I've never seen a reason to enter the realm of bonds that are going for less than 3% majority of the time. Yes, I do beat the market, consistently, because I employ several mathematically sound strategies...and yes, it isn't sustainable longterm, eventually I'll reach a point where I can't possibly take on more risk to unload it fast enough, so it'll eventually teeter to market rates, but that's when/if I ever reach about $3m+ in capital (I tend to spend my money when I get it).

[@evan2617]

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