Profitability of a treasury security Calculate the profitability rate of the following investment: Treasury security with nominal value of $1 000 000$ and $8\%$ coupon, 90 days to maturity and price of $1005000$ however you buy it 60 days before maturity. I am stuck with idea of profitability of treasury security with coupons. Because i thought it could be: $(1000000-1005000)/1005000 \cdot 360/60$ however i think that this is not a proper aswer. Would it be like $1000000\cdot(1+0.08\cdot1/4)\approx1020000$ instead of $1$ mln?

Hint: At maturity the security will pay $1\ 000\ 000$ plus interest. How much is that? You paid $1\ 005\ 000$ and get the above amount in $60$ days. How much is your absolute profit or loss? Now express your profit or loss as a percentage and scale that up to a year. Your computation is close to that, missing the first point about how much the security pays at maturity.