How to calculate par value of a bond

I am having difficulty transitioning a bond value function into a par value function. I believe it should be based around modifying the bond value function, but I am not seeing the process. Any help would be appreciated. After writing the correct par value function, I will have to verify it works with some known inputs.

> bond_value <- function(par, c_rate, ttm, y) {
+  cf <- c(rep(par*c_rate, ttm - 1), par*(1+c_rate))
+  cf <- data.frame(cf)
+  cf$t <- as.numeric(rownames(cf))
+  cf$pv_factor <- 1 / (1 + y)^cf$t
+  cf$pv <- cf$cf * cf$pv_factor
+  sum(cf$pv)
+ }
1 Like

Can you please describe more about what you want the modified function to calculate?

Given a beginning function

par <- function(bond_value, c, ttm, y) {

determine a function for par value, such that a given set of values will return a correct answer.

Par = Bond Price * 1/ bond price

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A good way to start approaching this question would be to write out the equation for par_value giving bond_value and other parameters (I think that's coupon rate, ttm is time to maturity and y is yield.

It looks like you're maybe taking Ang's datacamp course? The chapter 1 slides walk through this process to create the bond_value function.

Thank you. For the assistance.

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