A bond that is trading flat cannot do which of the following?

A bond that is trading flat does not include accrued interest in its trading price. This means that when a bond is trading flat, it is sold at the par value without any additional charge for the interest that has accumulated since the last coupon payment.

In this context, to trade with accrued interest would imply that the bond has an additional value added for the interest earned but not yet paid. Since a flat bond does not allow for this added interest, trading it in this manner is not permissible. Thus, the characteristics of a flat bond specifically exclude it from accruing this additional interest that would influence its market price.

The other aspects of bond trading, such as accruing interest, paying dividends, or impacting the yield curve, may still be relevant in different scenarios, but a bond trading flat distinctly signifies that it does not carry accrued interest at the time of sale.