yield to maturity

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Yield to maturity

The percentage rate of return paid on a bond, note, or other fixed income security if the investor buys and holds it to its maturity date. The calculation for YTM is based on the coupon rate, length of time to maturity, and market price. It assumes that coupon interest paid over the life of the bond will be reinvested at the same rate.

Yield to Maturity

The rate of return on a bond if it is held until maturity. This is expressed as an annual rate; the calculation of the YTM includes the coupon rate (if any), length of the bond, market value, and face value. Bond quotes are made in terms of the YTM, but an individual investor's yield may be different if he/she does not hold the bond, or if the bond is called before maturity.

yield to maturity (YTM)

The annual return on a bond held to maturity when interest payments and price appreciation (if priced below par) or depreciation (if priced above par) are considered. When a bond sells at par, the yield to maturity is the same as the current yield because price appreciation or depreciation is zero if the security is held to maturity. Bond quotations are generally on a yield-to-maturity basis, although an investor who sells a bond before maturity may earn a yield different from the yield to maturity as calculated at the time the security was purchased. See also internal rate of return, maturity basis.

Yield to maturity (YTM).

Yield to maturity is the most precise measure of a bond's anticipated return and determines its current market price.

YTM takes into account the coupon rate and the current interest rate in relation to the price, the purchase or discount price in relation to the par value, and the years remaining until the bond matures.

yield to maturity (YTM)

The internal rate of return of an investment, taking into consideration all incomes and expenses and their timing.

References in periodicals archive ?
Volume on Friday reached a record 18,239 contracts on options on the yield-to-maturity of 30-year Treasury bonds (ticket symbol TYX), and open interest stood at 30,437 contracts.
CBOE also lists options based on the spot yield of the 13-week Treasury bill (IRX) and yield-to-maturity of 5- and 10-year Treasury notes (FVX and TNX, respectively).
The offering of investment-grade senior unsecured notes includes $500 million in five-year notes having a yield-to-maturity of 5.
Volume yesterday reached a record 9,364 contracts on options on the yield-to-maturity of 30-year Treasury bonds (ticker symbol TYX), and open interest stood at 18,070 contracts.
Gain an insight into basic financial measures such as current yield, yield-to-maturity, and total return analysis
5) will list options on interest rates based on the yield-to-maturity of the most recent issues of 5- and 10-year Treasury notes and 30-year Treasury bonds.
25% coupon and were priced at a discount with a yield-to-maturity of 13.
The re-opening price corresponds to a yield-to-maturity of 11.
The terms of this purchase are identical to the original issue with the issue price representing a yield-to-maturity of 2.
The purchase price to be paid for each validly tendered debenture in this offer will be based on the April 1, 2000 redemption price discounted at the yield-to-maturity on the 6 3/4% U.