Wall Street Prep – in Bonds

A step-by-step course designed for those pursuing a career in fixed income research, investments, sales, and trading or investment banking (debt capital markets).

This course will teach you all about bonds. First, we’ll take a look at the role of bonds in financing governments, corporations, households and Financial Institutions around the world. Next, we’ll dive into bond math. You’ll learn the various calculations and concepts required to accurately analyze the large variety of fixed income products. We’ll start slow, but will quickly build up to some of the most traditionally confusing bond concepts: convexity, duration, spot rates, forward rates, and the drivers of changes to the all-important yield curve. We conclude with a discussion of credit analysis and an overview of debt capital markets. Enjoy the course!

Why You Should Take This Course

If you’ve ever tried to learn about bonds – either through a textbook, a university class, or CFA training materials, you’ve most likely discovered that it quickly gets painful. We’ll be blunt: bond analysis is usually taught horribly. Beyond super-basic concepts of bond pricing and interest rate valuation, concepts like convexity, modified duration, and forward curves are introduced with no connection to how they relate to real-world investment strategies.

We made this course with one overall objective in mind: to make something truly different than what’s out there now. Something that completely demystifies fixed income analysis and gives people a clear window to the inside.

We feel certain we’ve accomplished this. We take you step-by-step through the core concepts you need, and completely cut out concepts you’ll never use. The result is an intuitive look at the use of bonds in fixed income research, sales and trading, and investment banking.

We’ll be blunt: bond analysis is usually taught horribly. Our course completely demystifies fixed income analysis to give people from the outside a clear window to the inside.

What You Will Learn

  • Fixed income market overview
  • Bond math basics
  • Yield calculations and conventions
  • Money Market math
  • Interest rate risk
  • Real-world bond pricing nuances
  • Callable bonds
  • The yield curve
  • Nominal spread & Z-spread
  • OAS
  • Spot rates
  • Realized compound yield
  • Holding period yield
  • Forward rates
  • Credit analysis
  • Debt Capital Markets

Wall Street Prep’s  in Bonds is used at top financial institutions and business schools.

Exam and Certification

There is a 3-hour examination at the end of the course. You are eligible to take the exam for 24 months from the date you registered for the course.  Those who complete the exam and score above 70% will receive a Certification in Bond Analysis.  The exam is challenging and covers the most difficult concepts covered in the program.

Course Highlights

Used on the Street

This is the same comprehensive course our corporate clients use to prepare their analysts and associates.

1.5x, 2x video speed

Save loads of time by bumping up playback speed to breeze through lessons at your own pace.

Taught by bankers

Our instructors are former I-bankers who give lessons in a real-world context by connecting them to their experience on the desk.

Instructor Support

Have a question about the course content? Communicate directly with instructors by asking questions throughout the course.

Chapter 1: Fixed income market overview

  • What is fixed income?
  • Size of the bond market
  • Bond market geographic breakdown

Chapter 2: Bond Basics

  • Basic bond terms
  • Basic bond math
  • Using Excel’s RATE() function
  • Reinvestment assumption of YTM
  • YTM vs. current vs. nominal yield
  • Annuities
  • Bond price as the present value of a bond’s cash flows
  • Simple bond price exercise
  • More bond terms
  • Bond issuance costs
  • The price/yield relationship
  • Primary vs. secondary bond market
  • The bid/ask spread

Chapter 3: Yield calculations and conventions 

  • Coupon frequency and bond equivalent yield (BEY)
  • BEY vs Effective annual yield (EAY)
  • Converting from BEY to EAY
  • Compounding conventions of 0-coupon bonds

Chapter 4: The money market math 

  • Money market yield
  • Money market math exercises
  • Compounding
  • Discount basis
  • Converting interest rates
  • Money market instruments

Chapter 5: Real-world bond pricing nuances 

  • Settlement date
  • Bond pricing between coupons
  • Fractional periods
  • Day count convention
  • Dirty price
  • Dirty price exercise
  • Clean vs dirty price
  • Useful Excel functions
  • Bond pricing exercise, part 1
  • Bond pricing exercise, part 2
  • Bond pricing exercise, part 3
  • Interpreting the Bloomberg bond screen

Chapter 6: Realized compound yield and holding period yield 

  • Realized compound yield and holding period yield
  • RCY / HPY exercise, part 1
  • RCY / HPY exercise, part 2
  • RCY / HPY exercise, part 3

Chapter 7: Interest rate risk 

  • Intro to interest rate risk
  • DV01
  • Hedging interest rate risk
  • Estimating the price impact of rate changes
  • Modified duration & dollar duration
  • Modified duration exercise
  • Useful Excel functions for interest rate risk
  • Modified duration exercise, part 2
  • Modified duration exercise, part 3
  • Convexity
  • Convexity exercise
  • How convexity is applied in practice
  • Duration/convexity between coupons
  • Duration/convexity between coupons exercise
  • Interpreting the Bloomberg YAS screen

Chapter 8: Callable bonds 

  • Make the whole call
  • Make the whole call, Apple example
  • Callable bonds
  • Sinking fund redemption
  • Yield to call and yield to worst

Chapter 9: The yield curve 

  • Yield curve intro
  • Term structure theory
  • Monetary policy intro
  • Federal funds and the discount rate
  • Open market operations
  • Other central bank tools
  • Summary of forces affecting the yield curve
  • Yield curve shape at various points in the business cycle

Chapter 10: Spot rates 

  • Spot rates intro
  • Spot rates' role in the bond valuation
  • Full vs YTM bond valuation approaches
  • Bootstrapping the spot curve, part 1
  • Bootstrapping the spot curve, part

Chapter 11: Nominal spread, Z-spread, and OAS 

  • Yield spreads and the z-spread
  • Option adjusted spread

Chapter 12: Forward rates 

  • Forward rates
  • Forward rate exercise, part 1
  • Forward rate exercise, part 2
  • Forward rate exercise, part 3
  • Trading strategy using forward rates

Chapter 13: Credit analysis 

  • Credit risk
  • Credit analysis
  • Navigating Clear Channel’s bond agreement

Chapter 14: Debt capital markets and the debt origination process 

  • Debt origination primer

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