YIELD

YIELD

Measure of return over a period of time, expressed as a percentage of the coupon amount and the price of the bond. Simply put Yield at which the bond holder/investor buys the bond is expected to receive the same until maturity/Put/Call date as the case may be.

YIELD CURVE

YIELD CURVE

Graphical representation of yields against different bonds of multiple maturities. It is ideally an upward sloping graph in normal market condtitions implying the longer the maturity the higher the yield.

YIELD TO CALL

YIELD TO CALL

Yield to call is the actual return that an investment in a bond will give if it is held till the call date and not the maturity date. Call date gives the issuer the right but not the obligation to repay the principal amount to the investors on a predetermined date that falls before the maturity date.

YIELD TO MATURITY

YIELD TO MATURITY

Yield to maturity is the total return one would expect to receive if the security is being held until maturity. It is essentially the discount rate at which the present value of future payments equals the price of the security.