Intermediate-maturity bonds

There is another reason not to write off new investments in bonds Investors have some control over the pain they would suffer in a rising rate environment. To minimize losses, they can pick funds holding intermediate- or even short-maturity bonds, which fluctuate in price far less than the longest-maturity bonds. 

The field of silicon chemistry has enjoyed a very fast development in the last two decades with many novel significant discoveries being made [1]. Of particular interest in the context of this paper is the synthesis and characterization of a variety of reactive intermediates such as silylenes [2] and compounds with multiple bonds to silicon [3]. These exciting developments were occurring at the time when theory, in particular ab initio molecular orbital theory, was reaching "maturity" i.e. at the time when these methods could be used routinely to calculate reliably the properties of a variety of molecules, including silicon compounds [4]. 

Fig. 3. Schematic diagram of the self-processing reaction. ThrlOy ofimmature fi subunits adds to the carbonyl carbon of Gly-1, which results in a cyclic tetrahedral intermediate (I, II). The C—N bond is then cleaved and an ester compound is formed (III). Hydrolysis of the ester yields the propeptide and the mature ft subunit with Thrl at its N terminus (IV).

The first bond matures in precisely six months and thus has no intermediate cash flow before redemption. It can therefore be treated as a zero-coupon bond, and its yield of 6 percent taken as the 6-month spot rate. Using this, the 1-year spot rate can be derived from the price of a 1-year coupon Treasury. The principle of no-arbitrage pricing requires that the price of a 1-year Treasury strip equal the sum of the present value of the coupon Treasury s two cash flows ... 

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