AIR FRANCE: Investing on bonds

In September 2021, the Air France share price has risen sharply following the recovery of air traffic post covid. The case study focuses on three Air France bonds in a context of negative rates on short- and medium-term government bonds and a search for profitability by investors. These three bonds present interesting characteristics because they were issued at pre-covid and post-covid periods. They have residual maturities of approximately 1 year, 4 years and 5 years. In an unfavorable economic context for this type of sector, the case analyzes the prices, returns, sensitivities and durations of these 3 securities.

- Understand the difference between the price and the theoretical price of a bond,
- Know how to calculate the accrued interest of a bond,
- Know how to calculate the theoretical price of a bond,
- Know how to calculate the Actuarial Yield of a bond,
- Understand what a negative return means,
- Anticipate the reaction of a bond's price to different market news,
- Know how to calculate the sensitivity and duration of a bond,
- Know how to calculate the duration of a portfolio,
- Use the financial functions of Excel to calculate the theoretical price, the Yield to maturity, the duration and the sensitivity of a bond.

Bond - Yield to maturity - Accrued interest - Duration - Sensitive - Excel

- M1, M2, Mastères spécialisés
- Ecole ingénieurs
- MBA, Executive MS

Airline company

Drawer case (in several parts)

PPT: Debriefing (44 slides)
EXCEL: with exercices

Année de la problématique : 2021

Livraison : Livraison par lien de téléchargement

Nombre de pages : 11

Temps d'utilisation : 3h00

Code du secteur d'activité : 62 - Transports aériens