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what is y | y is a letter that appears on a stock symbol specifying that a particular stock is an american depositary receipt adr a stock symbol also known as a ticker symbol is a unique series of letters that are a shorthand way of identifying a company s specific stock a stock symbol can include a letter at the end of the symbol... | |
what is a y share | y shares are an institutional share class offered in open end mutual funds targeting institutional investors the share class often has a high minimum investment beginning at approximately 25 000 this share class also offers the benefit of waived or limited load charges and lower comparative total annual fees | |
how y shares work | y shares are an alternative to i shares which are in the most commonly offered mutual fund share class for institutional investors y shares have features and characteristics that are tailored to institutions high minimum investments are one of the most distinguishable characteristics of y shares and other institutional... | |
how much does it cost to buy y shares | many y share classes have no fees for purchasing the shares but charge a management fee y share classes do tend to have a high minimum investment threshold 25 000 or more however | |
why would my advisor change my shares to y shares | advisors may upgrade to y shares if there is a cost savings benefit mutual funds meanwhile may change the share class of an issued fund called a reclassification if certain requirements are met | |
what is y2k | y2k is the shorthand term for the year 2000 y2k was commonly used to refer to a widespread computer programming shortcut that was expected to cause extensive havoc as the year changed from 1999 to 2000 instead of allowing four digits for the year many computer programs only allowed two digits e g 99 instead of 1999 as ... | |
what led to y2k | y2k came about largely due to economics at the dawn of the computer age the programs being written required the type of data storage that was extremely costly since not many anticipated the success of this new technology or the speed with which it would take over firms were judicious in their budgets this lack of fores... | |
why was y2k scary | experts feared that the switch from the two digit year 99 to 00 would wreak havoc on computer systems ranging from airline reservations to financial databases to government systems for instance the banking system relied on dated computers and technologies and it wasn t irrational for depositors to worry about being abl... | |
how was y2k avoided | the u s government passed the year 2000 information and readiness disclosure act to prepare for the event and formed a president s council that consisted of senior officials from the administration and officials from agencies like the federal emergency management agency fema to monitor efforts of private companies to p... | |
what is yacht insurance | yacht insurance is an insurance policy that provides indemnity liability coverage for a sailing vessel it includes liability coverage for bodily injury or damage to the property of others and damage to personal property on the vessel depending on the insurance provider this insurance could also include gas delivery tow... | |
what is the yale school of management | yale school of management yale som is yale university s graduate business school yale school of management offers both mba and ph d level programs and is known for among other things its focus on finance and ethics the school introduced a new kind of integrated curriculum that combines a brief period of foreign study w... | |
what is a yankee bond | a yankee bond is a debt obligation issued by a foreign entity such as a government or company which is traded in the united states and denominated in u s dollars understanding a yankee bondyankee bonds are governed by the securities act of 1933 which requires the bonds to be registered with the securities and exchange ... | |
what is a yankee certificate of deposit cd | a yankee certificate of deposit cd is a type of cd that is issued in the united states by a branch of a foreign bank yankee cds are denominated in u s dollars and are used by foreign banks to raise capital from u s investors | |
how yankee cds work | foreign banks operating in the united states often need to access dollars for purposes such as extending credit to u s customers or satisfying u s dollar usd denominated obligations to help raise this usd capital foreign banks sometimes accept deposits from american customers through special cds called yankee bonds lik... | |
what is a yankee certificate of deposit cd | a yankee certificate of deposit cd is a type of cd that is issued in the united states by a branch of a foreign bank yankee cds are denominated in u s dollars and are used by foreign banks to raise capital from u s investors | |
how yankee cds work | foreign banks operating in the united states often need to access dollars for purposes such as extending credit to u s customers or satisfying u s dollar usd denominated obligations to help raise this usd capital foreign banks sometimes accept deposits from american customers through special cds called yankee bonds lik... | |
what is the yankee market | yankee market is a slang term for the stock market in the united states yankee market is usually used by non u s residents and refers to the slang term for an american a yankee or yank which itself is sometimes used as a playful though sometimes derogatory reference to u s citizens understanding the term yankee market... | |
what is a financial yard | the term yard is a financial term meaning one billion the term is derived from the term milliard which is used in some european languages and is equivalent to the number one billion used in american english a yard is equal to 10y 10 to the ninth power or the number one followed by nine zeros which is written out as 1 0... | |
what is a year end bonus | the term year end bonus refers to a form of compensation paid by employers to their employees in addition to their wages or salaries put simply a year end bonus is a reward that companies pay their workers the amount paid can vary but is usually based on an employee s position and salary it is commonly tied to performa... | |
how to use a year end bonus | there are several ways you can choose to use your year end bonuses but before you do it s always a good idea to weigh out the options so you make the right choice | |
what is year over year yoy | year over year yoy sometimes referred to as year on year is a frequently used financial comparison for looking at two or more measurable events on an annualized basis observing yoy performance allows for gauging if a company s financial performance is improving static or worsening for example you may read in financial ... | |
what is yoy used for | yoy is used to compare one time period and another one year earlier this allows for an annualized comparison say between third quarter earnings this year versus third quarter earnings the year before it is commonly used to compare a company s growth in profits or revenue and it can also be used to describe yearly chang... | |
how is yoy calculated | yoy calculations are straightforward and usually expressed in percentage terms this would involve taking the current year s value dividing it by the prior year s value and subtracting one this year last year 1 you can then multiply this by 100 to get a percentage | |
what s the difference between yoy and ytd | yoy looks at a 12 month change year to date ytd looks at a change relative to the beginning of the year usually jan 1 ytd can provide a running total while yoy can provide a point of comparison | |
what if i am interested in comparisons of less than a year | you can compute month over month or quarter over quarter q q in much the same way as yoy indeed you can choose any time frame you desire the bottom lineyear over year yoy is a useful tool for financial analysts corporations and investors it allows for the comparison of financial figures from one point in time to the sa... | |
what is year to date | year to date ytd refers to the period beginning on the first day of the current calendar year or fiscal year up to the current date ytd information is useful for analyzing business trends over time or comparing performance data to competitors or peers in the same industry the acronym is often seen in references to inve... | |
what does year to date mean on a pay stub | your ytd figure on a pay stub shows the total of your wages or earnings from the start of the current calendar year up to and including the most recent pay period most pay stubs show a running total of ytd earnings that includes gross wages net pay or both they may also provide a ytd tally of your fica taxes income tax... | |
how do you calculate year to date returns | consider an investor who bought shares in a company on january 1 at 200 per share they re worth 202 in march year to date equals 202 200 1 or 01 multiply this by 100 to arrive at 1 | |
what is month to date | month to date is used to measure earnings return and income it refers to the first of the month through the last business day before the current day because the current business day may still be in progress the bottom lineyear to date represents one way to measure the return provided by a group of securities or an inde... | |
what is the yearly probability of dying | yearly probability of dying is a statistical estimate of the likelihood of a person dying within a year usually based on their age sex and sometimes other factors it is widely used in health studies by the government and by the insurance industry in setting rates understanding the yearly probability of dyingestimates o... | |
what is the yearly probability of living | the yearly probability of living is basically the flip side of the yearly probability of dying also based on mortality tables it is an estimate of the likelihood of an individual still being alive a year into the future based on their age sex and sometimes other factors like the yearly probability of dying it is widely... | |
what is the mortality rate | the mortality rate represents the number of deaths as a percentage of a total population in a given period often one year the most basic mortality rate referred to as the crude mortality rate among statisticians doesn t differentiate between men and women or according to other factors more specialized types of mortalit... | |
what is life expectancy | life expectancy is another use of mortality data an estimate of how many more years a person with certain characteristics current age sex and so forth is likely to live or what age they are likely to attain before they die life expectancy estimates have many uses in the insurance industry and elsewhere for example the ... | |
what is the yearly probability of living | the yearly probability of living is a statistical concept that measures the likelihood that a given person or group of people will survive for one more year it is widely used in the insurance industry to underwrite life insurance contracts generally speaking older individuals will have a lower yearly probability of liv... | |
what is the yearly rate of return method | the yearly rate of return method commonly referred to as the annual percentage rate is the amount earned on a fund throughout an entire year the yearly rate of return is calculated by taking the amount of money gained or lost at the end of the year and dividing it by the initial investment at the beginning of the year ... | |
what is a yearly renewable term yrt | yearly renewable term is a one year temporary life insurance policy that automatically continues each year at the same death benefit when someone buys a yrt insurance policy the premium quoted is for one year of coverage based on the insured s current age premiums then increase annually to cover the increased risk of d... | |
why choose a yearly renewable term | policyholders with a yearly renewable term life insurance policy can lock in a length of time during which they will remain insurable during this period the policy can be renewed without the need for a medical exam renewability rules vary by state and insurer but it is generally permissible up to a certain age for exam... | |
why might you be interested in yearly renewable term life insurance | yrts offer flexible low cost coverage that appeals to those who only need insurance for a short period of time policyholders lock in a length of time during which they remain insurable during this time the policy can be renewed without the need for a medical exam | |
what is the main drawback of yrt | if a policyholder renews for many years they could end up paying more in total premiums than if they d simply bought a level term life or permanent life insurance policy however you may have the option to covert the yrt to a level premium term or whole life policy without additional medical exams or underwriting | |
how do yrt premiums differ from other types of insurance | yearly renewable term provides coverage for one year at a time with premiums rising annually based on the insured s current age other policies do not increase the premium as frequently a 10 year renewable term policy for example carries the same premium through its 10 year term and then can be renewed with new premiums... | |
what is the yearly renewable term plan of reinsurance | the yearly renewable term plan of reinsurance is a type of life reinsurance where mortality risks of an insurance company are transferred to a reinsurer through a process referred to as cession 1in the yearly renewable term plan of reinsurance the primary insurer the ceding company yields to a reinsurer its net amount ... | |
when setting up a reinsurance agreement the ceding company will prepare a schedule of the net amount at risk for each policy year the net amount at risk on a life insurance policy decreases over time as the insured pays premiums which adds to its accrued cash value | for example consider a whole life insurance policy issued for a face value of 100 000 at the time of issue the entire 100 000 is at risk but as its cash value accumulates it functions as a reserve account which reduces the net amount at risk for the insurance company therefore if the cash value of the insurance policy ... | |
how yearly renewable term reinsurance is used | yearly renewable term yrt reinsurance is typically used to reinsure traditional whole life insurance and universal life insurance term insurance wasn t always reinsured on a yrt basis this was so because coinsurance made for a better match of reinsurance costs with premiums received from the policyholder on level premi... | |
what is a years certain annuity | a years certain annuity is a retirement income product that pays the holder a continuous periodic income generally monthly for a specified number of years like all annuities it is used to provide a steady income during retirement however what makes a years certain annuity unique is that it provides that income for a pr... | |
how a years certain annuity works | for review an annuity is a financial product that is usually issued by an insurance or financial services company that pays the recipient called the annuitant a stream of payments over a period of time typically retirees use annuities to create a stable income stream the accumulation phase is when the annuity is being ... | |
what is year s maximum pensionable earnings ympe | the canadian government sets the year s maximum pensionable earnings ympe figure the ympe determines the maximum amount on which to base contributions to the canada or quebec pension plan c qpp the ympe specifies the earnings amount that can be used in calculating pension contributions for each year 12understanding yea... | |
what is a yellow knight | a yellow knight is a company that was orchestrating a hostile takeover attempt but then backs out of it and proposes a merger of equals with the target company instead understanding a yellow knightvarious colored knights are used to identify the nature of a takeover or potential takeover the process where a company tab... | |
why are these types of companies called yellow knights because yellow is a color associated among other things with cowardice and deceit | the term yellow knight is derogatory as it implies that the hostile bidder got cold feet and chickened out of the takeover attempt leaving it in a weak bargaining position other types of knightsin mergers and acquisitions m a the buying company may be described as a knight of any one of four different colors other than... | |
what are yellow sheets | yellow sheets are bulletins for bond traders which contain information for corporate bonds listed on the over the counter otc market the sheets contain data on each bond s yield volume high low closing and bid ask spread yellow sheets are published by the otc markets group formerly called the national quotation bureau ... | |
what is a yen etf | the term yen etf refers to an exchange traded fund etf that tracks the relative value of the japanese yen jpy in the foreign exchange forex market this is done against a single currency or against a basket of other currencies yen etfs invest primarily in yen backed assets including short term debt instruments and bonds... | |
how yen etfs work | buying and selling foreign currencies was traditionally a complicated process that involved opening up a foreign exchange account it was a privilege generally reserved for experienced traders with expert knowledge but etfs helped change that making the forex market more accessible to the average investor currency etfs ... | |
how can i invest in yen | as an ordinary investor japanese yen etfs are the easiest way to gain access to the yen | |
what is the main etf that trades the japanese yen | the invesco currencyshares japanese yen trust fxy is the most common yen etf which holds physical yen in its account 13 proshares also offers two yen etfs the proshares ultra yen etf ycl and proshares ultrashort yen etf ycs these two options though are levered ycl provides 2x long exposure and the ycs provides 2x inver... | |
how do i invest in the nikkei | american investors can invest in the nikkei 225 index japan s primary equity index via an etf these include | |
what is yield | the yield of a stock bond or other asset is the amount of money its investors are paid an investment s yield includes the interest it earns or the dividends paid to investors yield is expressed as a percentage based on the invested amount the current market value or the face value of the security for example microsoft ... | |
what yield can tell you | a higher yield value indicates that an investor is getting more cash flow from holding an investment but it s not that straightforward since dividends are paid from a company s profits higher dividend payouts should mean the company s earnings are increasing which could lead the stock s market price to rise but a highe... | |
when a company s stock price increases the current yield goes down because of the inverse relationship between yield and stock price | the yield on bonds that pay annual interest can be calculated in a straightforward manner called the nominal yield which is calculated as for example if there is a treasury bond with a face value of 1 000 that matures in one year and pays 5 annual interest its yield is calculated as 50 1 000 0 05 or 5 however the yield... | |
what does yield represent | yield represents the cash flow that is returned to the investor typically expressed on an annual basis it applies to various bonds stocks and funds and is presented as a percentage of a security s value key components that influence a security s yield include dividends or the price movements of a security | |
how is yield calculated | to calculate yield a security s net realized return is divided by the principal amount there are different ways to arrive at a security s yield depending on the type of asset and the type of yield | |
what is an example of yield | as one measure for assessing risk consider an investor who wants to calculate the yield to worst ytw on a callable bond essentially this measures the lowest possible yield if the issuer opts to call the bond earlier than its maturity date the investor would find the bond s earliest callable date the date that the issue... | |
what is yield based option | a yield based option allows investors to buy or sell calls and puts on the yield of a security rather than its price understanding yield based optionsa yield based option is a contract that gives the buyer the right but not the obligation to purchase or sell at the underlying value which is equal to 10 times the yield ... | |
what is yield basis | the yield basis is a method of quoting the price of a fixed income security as a yield percentage rather than as a dollar value this allows bonds with varying characteristics to be easily compared the yield basis is calculated by dividing the coupon amount paid annually by the bond purchase price understanding yield ba... | |
when purchasing bonds it s important for the investor to understand the difference between the yield basis and the net yield basis on the secondary market you can purchase bonds through a broker dealer who could charge you a flat commission for this service however in lieu of a commission your broker may opt to sell bo... | net yield means the yield also includes the broker s profit for the transaction this is the broker s markup which is the difference between what the broker paid for the bonds and what the broker sells them for if a broker offers bonds on a net yield basis they ve already included their markup for example if an online b... | |
what is a yield curve | a yield curve is a line that plots the yields or interest rates of bonds that have equal credit quality but different maturity dates the slope of the yield curve predicts the direction of interest rates and the economic expansion or contraction that could result yield curves have three main shapes normal upward sloping... | |
what is a u s treasury yield curve | the u s treasury yield curve is a line chart that allows for the comparison of the yields of short term treasury bills and the yields of long term treasury notes and bonds the chart shows the relationship between the interest rates and the maturities of u s treasury fixed income securities the treasury yield curve is a... | |
what is yield curve risk | yield curve risk refers to the adverse effect of a shift in interest rates on the returns from fixed income instruments such as bonds it stems from the fact that bond prices and interest rates have an inverse relationship to each other the prices of bonds in the secondary market decrease when market interest rates incr... | |
how can investors use the yield curve | investors can use the yield curve to make predictions about the economy that will affect their investment decisions an investor might move their money into defensive assets that traditionally do well during a recession if the bond yield curve indicates an economic slowdown they might avoid long term bonds with a yield ... | |
what is the yield curve risk | the yield curve risk is the risk of experiencing an adverse shift in market interest rates associated with investing in a fixed income instrument when market yields change this will impact the price of a fixed income instrument when market interest rates or yields increase the price of a bond will decrease and vice ver... | |
when interest rates converge the yield curve flattens a flattening yield curve is defined as the narrowing of the yield spread between long and short term interest rates when this happens the price of the bond will change accordingly if the bond is a short term bond maturing in three years and the three year yield decr... | let s look at an example of a flattener let s say the treasury yields on a 2 year note and a 30 year bond are 1 1 and 3 6 respectively if the yield on the note falls to 0 9 and the yield on the bond decreases to 3 2 the yield on the longer term asset has a much bigger drop than the yield on the shorter term treasury th... | |
what is yield equivalence | yield equivalence is the interest rate on a taxable security that would generate a return equivalent to the return of a tax exempt security and vice versa understanding yield equivalenceyield equivalence is important to municipal bond investors who want to know if the tax savings of their bonds will make up for the low... | |
when calculating the yield equivalence between tax free and taxable investments investors should be aware of these new tax rates and incorporate them accordingly into their yield equivalence equations | 2021 income tax brackets | |
what is yield maintenance | yield maintenance is a sort of prepayment penalty that allows investors to attain the same yield as if the borrower made all scheduled interest payments up until the maturity date it dictates that borrowers pay the rate differential between the loan interest rate and the prevailing market interest rate on the prepaid c... | |
when a borrower obtains financing either by issuing bonds or by taking out a loan e g mortgage auto loan business loan etc the lender is periodically paid interest as compensation for the use of their money for a period of time the interest that is expected constitutes a rate of return for the lender who projects earni... | for example an investor who purchases a 10 year bond with a 100 000 face value and an annual coupon rate of 7 intends to be credited annually by 7 x 100 000 7 000 likewise a bank that approves a 350 000 at a fixed interest rate expects to receive interest payments monthly until the borrower completes the mortgage payme... | |
how to calculate yield maintenance | the formula for calculating a yield maintenance premium is ym pv of rp on the mortgage ir ty where ym yield maintenance pv present value rp remaining payments ir interest rate ty treasury yield the present value factor in the formula can be calculated as 1 1 r n 12 r where r treasury yield n number of months begin alig... | |
what is yield on cost yoc | yield on cost yoc is a measure of dividend yield calculated by dividing a stock s current dividend by the price initially paid for that stock for example if an investor purchased a stock five years ago for 20 and its current dividend is 1 50 per share then the yoc for that stock would be 7 5 yoc should not be confused ... | |
when evaluating dividend yields investors must also be careful not to compare apples and oranges specifically just because a stock s yoc is higher than the current dividend yield of another company it does not mean that the stock with the higher yoc is necessarily the better investment that is because the company with ... | in these situations the investor could be better off selling their shares in the high yoc company and investing the proceeds in a company with a higher current dividend yield considering yoc shows investors the long term benefits of stocks compared to bonds since bonds pay fixed interest rates rather than dividends tha... | |
what is yield on earning assets | the yield on earning assets is a popular financial solvency ratio that compares a financial institution s interest income to its earning assets yield on earning assets indicates how well assets are performing by looking at how much income they bring in understanding yield on earning assetssolvency ratios shed light on ... | |
what is yield pickup | yield pickup refers to the additional interest rate an investor receives by selling a lower yielding bond and buying a higher yielding bond the yield pickup is done to improve the risk adjusted performance of a portfolio understanding a yield pickup strategya yield pickup is an investment strategy which involves tradin... | |
what is a yield spread | a yield spread is the difference between yields on differing debt instruments of varying maturities credit ratings issuers or risk levels a yield spread is calculated by deducting the yield of one instrument from the other this difference is most often expressed in basis points bps or percentage points yield spreads ar... | |
how yield spreads work | the yield spread is a key metric that bond investors use when gauging the level of expense for a bond or group of bonds if one bond yields 7 and another one yields 4 the spread is three percentage points or 300 bps non treasury bonds are generally evaluated based on the difference between their yield and that of a trea... | |
what is a yield spread | the difference in yields on two debt instruments that have different maturity dates issuers credit ratings or risk levels is known as the yield spread yield spreads are commonly reported in percentage or basis points in order to determine the yield spread you must subtract one investment s yield from that of the other ... | |
what is a yield spread premium | a yield spread premium is a type of compensation paid to mortgage brokers these individuals receive this fee from lenders when they give borrowers mortgage loans with interest rates that are higher than the lender s standard rate the yield spread premium doesn t include any additional costs that borrowers are typically... | |
what is a yield spread premium ysp | a yield spread premium ysp is a form of compensation that a mortgage broker acting as the intermediary receives from the originating lender for selling an interest rate to a borrower that is above the lender s par rate for which the borrower qualifies the ysp can sometimes be applied to cover costs associated with the ... | |
how a yield spread premium worked | mortgage brokers are compensated directly by borrowers when the borrower pays an origination fee when the lender pays the broker a yield spread premium or a combination of these if there is no origination fee the borrower is most likely agreeing to pay an interest rate above the market rate paying an interest rate abov... | |
what is a yield tilt index fund | a yield tilt index fund is a type of fund that invests in stocks or securities that mirrors the holdings of a market index but contains a higher weighting towards higher yielding investments a yield tilt index fund can be a mutual fund which is a basket of securities that are actively managed by a portfolio or fund man... | |
how a yield tilt index fund works | typically an index fund would contain all of the stocks of a particular stock index such as the standard poor s 500 index s p 500 investors can t buy an index per se since it s merely a tracking mechanism containing a collection of stocks designed to provide investors with the overall trend for those stocks instead inv... | |
how to invest in a yield tilt index fund | investors will find that the tax advantaged strategy of holding yield tilt index funds in tax sheltered accounts means that they will be purchasing these types of funds as an etf the investor would purchase the etf through the custodian who manages their tax sheltered account such as schwab fidelity or maybe a robo adv... | |
what is a good roi for an index fund | there are tax considerations when using an index fund as well as expense ratios that could eat away at a return on investment roi an index fund will not necessarily deliver the highest return but this comes with the benefit of diversification diversification alleviates some aspects of risk and is considered a must in a... | |
do i get dividends from index funds | certain index funds pay dividends as the fund receives dividends from the stocks they hold in the fund others will reinvest the dividends into their fund and although the investor who holds shares in the index fund won t receive an actual dividend the reinvestment will be apparent in the appreciation of the fund s shar... | |
what is a dividend yield fund | a dividend yield fund is a fund that tracks an index of companies that have a history of paying regular high dividends these funds will seek to mirror the performance of the underlying index investors who favor a dividend based strategy will lean heavily on these funds for the core of their investment portfolio the bot... | |
what is yield to average life | yield to average life is the calculation of a bond s yield based on the average maturity rather than the stated maturity date of the issue this yield replaces the stated final maturity with the average life maturity average life is also called the weighted average maturity wam or weighted average life wal understanding... | |
what is yield to call | yield to call ytc is the return that a bondholder will be paid if the bond is held until the call date which will occur sometime before the bond reaches maturity yield to call applies to callable bonds a type of bond that allows the investor to redeem the bond or the bond issuer to repurchase it on the call date at a p... | |
where | p the current market pricec the annual coupon paymentcp the call pricet the number of years remaining until the call dateytc the yield to callbased on this formula the yield to call cannot be solved directly an iterative process must be used to find the yield to call if the calculation is being done by hand fortunately... | |
are callable bonds better than non callable bonds | non callable bonds are preferred by some investors because the issuer is locked into the return until the bond reaches its maturity date for the same reason non callable bonds tend to pay a little less interest than callable bonds the issuer is taking the risk that a change in interest rates will force it to pay more i... | |
are most bonds callable | most corporate bonds and municipal bonds are callable most u s treasury bonds and notes are non callable | |
what happens to callable bonds when interest rates rise | the issuer of a bond is less likely to call the bond when interest rates rise the issuer is unlikely to get a better deal by replacing it | |
when interest rates decline the issuer is more likely to call the bond in order to replace it | the bottom lineif you invest in callable bonds you need to know its yield to maturity but it is perhaps more important to know its yield to call yield to call is the return you will get if the issuer decides to essentially cancel the issue and pay off investors early if you want real assurance that you ll get the yield... | |
what is yield to maturity ytm | yield to maturity ytm is considered a long term bond yield but is expressed as an annual rate it is the internal rate of return irr of an investment in a bond if the investor holds the bond until maturity with all payments made as scheduled and reinvested at the same rate yield to maturity is also referred to as book y... | |
what are limitations of ytm | ytm calculations usually do not account for taxes that an investor pays on the bond 1 in this case ytm is known as the gross redemption yield ytm calculations also do not account for purchasing or selling costs ytm makes assumptions about the future and an investor may not be able to reinvest all coupons the bond may n... | |
what is the difference between a bond s ytm and its coupon rate | the main difference between the ytm of a bond and its coupon rate is that the coupon rate is fixed and the ytm fluctuates the coupon rate is contractually fixed whereas the ytm changes based on the price paid for the bond and the interest rates available in the marketplace |
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