Realized compound yield

Realized compound yield

Yield assuming that coupon payments are invested at the going market interest rate at the time of their receipt and held thus until the bond matures.

Realized Compound Yield

The yield on a bond calculated by assuming that the bondholder reinvests all coupons at the current interest rate and holds those positions until the bond matures.
References in periodicals archive ?
In evaluating fixed-income investments such as corporate or government bonds, the investor is faced with a variety of measures of investment return or yield: current yield; yield-to-maturity; yield-to-call; after-tax yield; taxable equivalent yield; and realized compound yield.
This section is designed to clarify the meaning and distinctions among: coupon rate, yield-to-maturity, after-tax yield, taxable equivalent yield, current yield, realized compound yield, and yield-to-call.
The realized compound yield can be found by solving an internal rate of return problem.
Expressed as a decimal, the realized compound yield on a 1-year ride with a 2-year bond is: