Fundamentals and Trends

• Interest can be determined by the function of the risk and the compensation of the investor.
• The risk-free rate is the rate that assumes zero default in the market which is more or less equivalent to the rates offered by the sovereign.
• The PDS Group is an organized market that was formed out of the financial distress in 1997. On a normal basis, they release the Treasury Bills on which the risk-free rate is based on.
• Bond valuation is a technique for determining the theoretical fair value of a particular bond.