Date: Tuesday, March 20, 2007
Case: The Walt Disney Company: 100-Year Bonds-Sleeping Beauties? (UVA-F-1063)
Read:
1. Valuing Assets in Financial Markets (UVA-F-1518)
2. Duration and Convexity (UVA-F-1238)
Network File: None
Class Objective:
Cover and understand basic ways to measure a bond's price sensitivity to interest rate changes
Assignment:
1. How risky are the Disney Bonds?
2. What types of risk are relevant to your risk assessment?
3. In terms of risk, how do these bonds compare with a comparable 30-year issue?
4. What is your recommendation?