When underwriting new corporate bonds, matrix pricing is used to get an estimate of the:
A) required yield spread over the benchmark rate.
B) market discount rate of other comparable corporate bonds.
C) yield-to-maturity on a government bond having a similar time-to-maturity.

Question

Quizplus · Accepted Answer

Matrix pricing is used to estimate the required yield spread over the benchmark rate for new corporate bonds by comparing them with similar bonds in the market.

When Underwriting New Corporate Bonds, Matrix Pricing Is Used to Get