Yield is the return you earn on a bond or other investment. For bonds, yield to maturity (YTM) considers coupon payments and price changes. When bond prices fall, yields rise. Current yield = annual coupon ÷ price.
Example
A $1,000 bond at $950 with 4% coupon has higher yield than at par.
Subscribe for simple financial insights and product updates. No spam, ever.
No spam, ever. Unsubscribe anytime.