discount yield
(redirected from Discount Yields)Discount yield
The yield or annual interest rate on a security sold to an investor at a discount. A bond that is sold at $4875 that matures to $5000 has a discount of $125. To calculate the discount yield: (discount divided by the face value of the security) multiplied by the (number of days in the year divided by the number of days to maturity).
Discount Yield
A way to quote the price for bonds. It is calculated as the annualized yield assuming a 360 day year. One calculates the discount yield thusly:
Discount yield = (Discount from par value / par value) * (360 / Days until maturity)
The discount yield is also called the discount basis or the bank-discount basis.
Discount yield = (Discount from par value / par value) * (360 / Days until maturity)
The discount yield is also called the discount basis or the bank-discount basis.
discount yield
See bank-discount basis.