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  2. Yield to maturity - Wikipedia

    en.wikipedia.org/wiki/Yield_to_maturity

    With 20 years remaining to maturity, the price of the bond will be 100/1.07 20, or $25.84. Even though the yield-to-maturity for the remaining life of the bond is just 7%, and the yield-to-maturity bargained for when the bond was purchased was only 10%, the annualized return earned over the first 10 years is 16.25%.

  3. Bootstrapping (finance) - Wikipedia

    en.wikipedia.org/wiki/Bootstrapping_(finance)

    In finance, bootstrapping is a method for constructing a (zero-coupon) fixed-income yield curve from the prices of a set of coupon-bearing products, e.g. bonds and swaps. [ 1 ] A bootstrapped curve , correspondingly, is one where the prices of the instruments used as an input to the curve, will be an exact output , when these same instruments ...

  4. Bond Price vs. Yield: Why The Difference Matters to Investors

    www.aol.com/bond-price-vs-yield-why-140036009.html

    Holding that bond for one year (to maturity) would result in a yield of 5%. That would be its coupon yield or nominal yield. Current Yield – But now consider how yield changes if the price of ...

  5. Yield curve - Wikipedia

    en.wikipedia.org/wiki/Yield_curve

    The vertical or y-axis depicts the annualized yield to maturity. [3] Those who issue and trade in forms of debt, such as loans and bonds, use yield curves to determine their value. [4] Shifts in the shape and slope of the yield curve are thought to be related to investor expectations for the economy and interest rates.

  6. What is a Treasury bond? - AOL

    www.aol.com/finance/treasury-bond-215931993.html

    Treasury bond interest rates (also known as yield) are tied to the specific bond’s maturity date. The T-bond’s yield represents the return stemming from the bond, and is the interest rate the ...

  7. Duration (finance) - Wikipedia

    en.wikipedia.org/wiki/Duration_(finance)

    Expression (3) which uses the bond's yield to maturity to calculate discount factors. The key difference between the two durations is that the Fisher–Weil duration allows for the possibility of a sloping yield curve, whereas the second form is based on a constant value of the yield , not varying by term to payment. [10]

  8. Yield elasticity of bond value - Wikipedia

    en.wikipedia.org/wiki/Yield_elasticity_of_bond_value

    The yield elasticity of bond value is the elasticity of the market value of a bond with respect to its yield—the percentage change in bond value divided by its causative percent change in the yield to maturity of the bond. Equivalently, it is the derivative of value with respect to yield

  9. Bond option - Wikipedia

    en.wikipedia.org/wiki/Bond_option

    The lattice-based model entails a tree of short rates – a zeroeth step – consistent with today's yield curve and short rate (often caplet) volatility, and where the final time step of the tree corresponds to the date of the underlying bond's maturity. Using this tree (1) the bond is valued at each node by "stepping backwards" through the ...