If you study Finance, eventually you find yourself studying bonds. If you study bonds, eventually you will be asked to calculate Duration: > Macaulay's Duration (the effective term of the various cash flows of the bond, the equivalent "zero" coupon bond) > Modified Duration (what percent change in price is expected for each one percent change in interest rate) > Convexity (duration is less exact for bog moves in interest rates, convexity can correct for this imprecision) > DV01 (what is the change in value of a one basis point change in interest rates; that is, .01% or 1 one-hundredth of one percent). Here's a spreadsheet that I created to prepare for a meeting with a Georgetown student who's in a Finance class there: *** I found this Finance Ratios quick reference on the internet a few years ago. I didn't write down the author of the document, it was a professor in a University in Utah. Thank you! There is some variation in how people calculate the various ratios and the names they give them, but this is a great summary document: |