Calculating Number of Days of Accrued Interest. Series 7 Exam Prep

Описание: A J/J 15 schedule means the bond pays interest on January and July 15. Corporate (and municipal) bonds count each month as 30 days.

As with all bonds, the accrued interest is paid from the previous interest payment date up to but not including the settlement date. A trade made on Friday the 17th settles the following Monday (T+1), April 20 . The previous interest payment was January 15. Do the following simple calculation:

Settlement date of 4/20

Minus last interest - 1/15

Result is 3/05 , or 3 months plus 5 days

With each month being 30 days, the answer is 90 + 5 or 95 days.