In some problems, the formula goes like this (found it neater to link a pic), and in others it omits the “1/2”. Why? I must have missed the reason while studying, and now I seem unable to find it in the literature. Please help, much appreciated!
This has been discussed several times; look here:
http://www.analystforum.com/forums/cfa-forums/cfa-level-i-forum/91320692
Thank you very much!
You said you “wouldn’t think that it’s likely that you’ll be doing a duration/convexity calculation in a credit analysis question”, so then if there’s a duration question, we just use the common form (without 0.5)?
You’re quite welcome.
No.
If there’s a duration question, you ascertain whether it’s in the context of credit analysis. If not, don’t include 0.5; if so, include it.
Thanks again! You’ve cleared it out now.
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