Chapter 9 P9.2 Calculate this Problem in Excel Spreadsheet showing all the formulas and calculations used Listed below are data that pertain to the corporate bond market. (Note: Each ?period? below covers a span of 6 months.) Period 1 Period 2 Period 3 Period 4 Average yield on 10 high-grade Corporate 5.30% 5.70% 5.10% ?__ Bonds Yield on the Dow Jones average of 6.50% ? 6.00% 4.90% 40 Corporate bonds Yield spread (in basis points) ? 155 ? 25 Confidence index ____ _____ ____ ____ a. Compute the confidence index for each of the four periods listed above. b. Assume the latest confidence index (for period 0, in effect) amounts to 86.83%, while the yield spread between high- and average-grade corporate bonds is 85 basis points. Based on your calculations, what?s happening to bond yield spreads and the confidence index over the period of time covered in the problem (i.e., from period 0 through period 4)? c. Based on the confidence index measures you computed, what would be your overall assessment of the stock market? In which one or more of the periods (1 through 4) is the confidence index bullish? In which one(s) is it bearish? P9.4 Calculate this Problem in Excel Spreadsheet showing all the formulas and calculations used Below are figures representing the number of stocks making new highs and new lows for each month over a six month period: Month New Highs New Lows July 117 22 August 95 34 September 84 41 October 64 79 November 53 98 December 19 101 Would a technical analyst consider the trend to be bullish or bearish over this period? Explain. Calculate this in Excel Spreadsheet showing all the Formulas and Calculations.
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