Written for undergraduates, this book is dedicated to fixed income
fundamentals that do not require modeling the dynamics of interest
rates. The book concentrates on understanding and explaining the pillars
of fixed income markets, using the modern finance approach implied by
the 'no free lunch' condition. It focuses on conceptual understanding so
that novice readers will be familiar with tools needed to analyze bond
markets. Institutional information is covered only to the extent that is
necessary to obtain full appreciation of concepts.This volume will equip
readers with a solid and intuitive understanding of the No Arbitrage
Condition -- its link to the existence and estimation of the term
structure of interest rates, and to valuation of financial contracts.
Using the modern approach of arbitrage arguments, the book addresses
positions and contracts that do not require modeling evolution of
interest rates. As such, it welcomes readers lacking the technical
background for this modeling, and provides them with good intuition for
interest rates, no arbitrage condition, bond markets and certain
financial contracts.