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We are tasked with calculating the percentage return over a 6-month holding period for a 10% coupon bond, which has a yield-to-maturity (YTM) of 9.1% and a par value of $1,000. Let's break this down step-by-step.

### Key Information:
- **Coupon rate**: 10% annually, meaning $100 coupon payment per year.
- **Par value**: $1,000.
- **Yield-to-maturity**: 9.1%.
- **Holding period**: 6 months (half a year).
- **Coupon payment for 6 months**: Since the bond pays 10% annually, you will receive half of that for 6 months, i.e., $100 / 2 = $50.

### Step-by-Step Process:

1. **Price of the bond at purchase (based on YTM of 9.1%)**:
   We need to calculate the price of the bond when purchased. The formula to calculate the price of a bond is:

   \[
   P = \frac{C}{1 + \frac{YTM}{2}} + \frac{C}{\left(1 + \frac{YTM}{2}\right)^2} + \cdots + \frac{C + FV}{\left(1 + \frac{YTM}{2}\right)^{2n}}
   \]

   where:
   - $C$ = semiannual coupon payment = $50.
   - $FV$ = face value = $1,000.
   - $YTM$ = 9.1% annually (or 4.55% semiannually).
   - $n$ = number of periods remaining = 6 years or 12 periods.

2. **Price of the bond after 6 months**:
   After 6 months, there will be 11 semiannual periods remaining until maturity. We will use the same formula as above to calculate the bond price at this point.

3. **Return calculation**:
   The total return is the gain from the coupon payment plus the price difference. We calculate the percentage return as:

   \[
   \text{Return} = \frac{\text{Coupon Payment} + \text{(Price Sold - Price Bought)}}{\text{Price Bought}}
   \]

Let me now compute the bond prices and the return based on these formulas.Here are the key results for the bond's 6-month holding period:

- **Price at purchase**: $1,040.92
- **Price after 6 months**: $1,038.28
- **Total percentage return**: 0.0455 (or 4.55%)

This result includes the semiannual coupon payment of $50 and the slight decline in the bond's price after 6 months. Your total return for the 6-month period is **4.55%**.

Would you like more details or explanations? Here are 5 related questions to deepen your understanding:

1. How does the bond's price change when the yield-to-maturity increases or decreases?
2. What is the relationship between the coupon rate and yield-to-maturity?
3. Why did the bond price decrease slightly over the 6 months in this case?
4. How would the return change if the bond's price increased after 6 months instead?
5. Can the return be negative if the bond's price drops significantly?

**Tip**: Bond prices move inversely to interest rates. When the yield-to-maturity stays constant, the price gradually moves toward the bond's face value as it nears maturity.

A 10% coupon bond has a par value of $1,000 and a yield-to-maturity of 9.1%. You purchase the bond when it has exactly 6 years remaining until maturity. You hold the bond for 6 months, collect the coupon payment, and then sell the bond immediately. If the bond's yield-to-maturity doesn't change between the time you buy and sell the bond, what is your percentage return over this 6-month holding period? Enter your answer as a decimal and show 4 decimal places. DO NOT annualize your answer. For example, if your answer is 6.25%, enter .0625.

Learn how to calculate the percentage return on a 10% coupon bond with a par value of $1,000 and a yield-to-maturity of 9.1% over a 6-month holding period. Understand bond pricing, yield-to-maturity, and the percentage return calculation with detailed step-by-step instructions. Suitable for college-level finance students.

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