PRM 1 – Bond Yield Street Convention vs Treasury

[Boris Lee]

Hi all,

If I read the page 4 of the “Financial Instruments” Chapter 1, it is written

Quote
the “street convention” uses simple interest in the first period and compounded interest thereafter.
End Quote

Is the above statement correct? Isn’t “Treasury convention” uses simple interest in the first period, whereas “Street Convention” uses compounded interest from the first period?

Thanks

Regards

Boris

[Author]

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