Bonds with different maturity dates are more or less sensitive to changes in the market interest rate depending on the time until they mature.
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Discount Yield = [(Face Value – Price) / Face Value][360/Days] Days to maturity in a 360 day year is convention. BEY is more accurate. Can possibly be simplified further to: (1-P)(360/NSM) = Discount Yield
Yield Ratio = Yield on bond X / Yield on bond Y In the U.S. the yield on bond Y is frequently the on-the-run U.S. Treasury Bond.
Is simply the IRR of all future cash flows from the bond.
d = (1 – P)(360 / Nsm) P = settlement price per $1 of maturity value Nsm = number of days between settlement date and the maturity date d = yield on a discount basis
BEY = 2[(1 + annual pay yield)^.5 – 1]
after-tax yield = pre-tax yield * (1 – marginal tax rate)
current yield = annual dollar coupon interest / price annual dollar coupon interest is the interest times the par value (usually 100)
Is double the semiannual yield.