Bond Valuation for Colleges and Universities.

Bond valuation is examined to provide college administrators a more thorough understanding of the process to help them in developing their market values, or to help them in moving to a market valuation on bond holdings. Two methods presently used to value bonds, a matrix system and a trader quotation method, are described. An overview of bond markets and a discussion of dealer quote versus matrix pricing are presented. Features important to educational institutions when considering a bond-pricing service are considered. The two services that are the best-known evaluation of debt issues in the United States are Moody's and Standard and Poor's. Salomon Brothers is probably the largest bond trading house in the world, with the most comprehensive organization of bond traders. Additional services described are provided by: Kuhn Loeb, Digital Information Corporation, Interactive Data Services, Inc., Telstat, and Merrill Lynch. (SW)