In other words, it factors in the time value of money, whereas a simple current yield calculation does not. Yield To Maturity: It is also known as redemption yield. What is the difference between a bond’s YTM and its coupon rate? An investor will determine a required yield (the return on a bond that will make the bond worthwhile). Yield to maturity is the total rate of return that will have been earned by a bond when it makes all interest payments and repays the original principal. De très nombreux exemples de phrases traduites contenant "yields to maturity" – Dictionnaire français-anglais et moteur de recherche de traductions françaises. In other words, it is the return on investment associated with buying the bond and reinvesting its coupon payments at a constant interest rate. Merci de vous connecter ou de créer un compte pour accéder au contenu. Each one of the future cash flows of the bond is known and because the bond's current price is also known, a trial-and-error process can be applied to the YTM variable in the equation until the present value of the stream of payments equals the bond's price. For example, if an investor was evaluating a bond with both call and put provisions, she would calculate the YTW based on the option terms that give the lowest yield. In this case, YTM is known as the gross redemption yield. Now we must solve for the interest rate "YTM," which is where things get tough. Instead, one can approximate YTM by using a bond yield table, financial calculator, or online yield to maturity calculator. Modified duration is a formula that expresses the measurable change in the value of a security in response to a change in interest rates. Because the bond price in our example is $95.92, the list indicates that the interest rate we are solving for is between 6% and 7%. When the bond is priced at par, the bond's interest rate is equal to its coupon rate. betekenis & definitie Yield to maturity is een manier om het rendement over een obligatie te berekenen, ervan uitgaande dat de houder de obligatie behoudt tot aan de afloopdatum. Yield to maturity (YTM) is also an interest rate associated to bonds but reflect the entire return that the bondholder will receive until the bond’s maturity date. Example of Yield to Maturity. The YTM is merely a snapshot of the return on a bond because coupon payments cannot always be reinvested at the same interest rate. Fortunately, 6.8% corresponds precisely to our bond price, so no further calculations are required. Because YTM is expressed as an annual rate regardless of the bond's term to maturity, it can be used to compare bonds that have different maturities and coupons since YTM expresses the value of different bonds in the same annual terms. De yield to maturity wordt bepaalt door de coupon (rente over de obligatie) en het verschil tussen de aankoopprijs en prijs bij terugbetaling. Yield to maturity is considered to be a long-term bond yield although it … The YTM of a bond is essentially the internal rate of return (IRR) associated with buying that bond and holding it until its maturity date. yield to maturity. [...] different from a conventional bond in that the "real" yield to maturity is known at the time the bond is issued. Bond Valuation: What's the Fair Value of a Bond? The YTM is based on the belief or understanding that an investor purchases the security at the current market price and holds it until the security has matured Yield To Maturity implique que l'investisseur qui achète une obligation d'aujourd'hui au prix du marché, détiendra cette obligation jusqu'à l'échéance, et que tous les coupons (et réinvestissements de ses coupons) et les paiements en capital seront effectués aux dates prévus. The yield to maturity (YTM), book yield or redemption yield of a bond or other fixed-interest security, such as gilts, is the (theoretical) internal rate of return (IRR, overall interest rate) earned by an investor who buys the bond today at the market price, assuming that the bond is held until maturity, and that all coupon and principal payments are made on schedule. Yield to maturity includes both the interest payments you receive from a bond along with the capital gain you receive at maturity, if any.The lower the price you can pay for a particular bond, the higher your yield to maturity will be, all other factors being equal. yield to maturity (finance) taux actuariel, rendement à l'échéance nm nom masculin : s'utilise avec les articles "le", "l'" (devant une voyelle ou un h muet), "un" . Calculations of yield to maturity (YTM) assume that all coupon payments are reinvested at the same rate as the bond's current yield and take into account the bond's current market price, par value, coupon interest rate, and term to maturity. Cherchez des exemples de traductions yield to maturity dans des phrases, écoutez à la prononciation et apprenez la grammaire. Définition, traduction, prononciation, anagramme et synonyme sur le dictionnaire libre Wiktionnaire. The YTM of a discount bond that does not pay a coupon is a good starting place in order to understand some of the more complex issues with coupon bonds. Current Market Price 2. Lorsque les investisseurs emploient le terme de rendement, ils font généralement référence au rendement à l'échéance, ou taux actuariel. The formula to calculate YTM of a discount bond is as follows: YTM=Face ValueCurrent Pricen−1where:n=number of years to maturityFace value=bond’s maturity value or par value\begin{aligned} &YTM=\sqrt[n]{\frac{\textit{Face Value}}{\textit{Current Price}}}-1\\ &\textbf{where:}\\ &n=\text{number of years to maturity}\\ &\text{Face value}=\text{bond's maturity value or par value}\\ &\text{Current price}=\text{the bond's price today} \end{aligned}YTM=nCurrent PriceFace Value−1where:n=number of years to maturityFace value=bond’s maturity value or par value. If the YTM is higher than the coupon rate, this suggests that the bond is being sold at a discount to its par value. y = yield to maturity(expressed in percentage points). The coupon rate is contractually fixed, whereas the YTM changes based on the price paid for the bond as well as the interest rates available elsewhere in the marketplace. Learn more. Yield to put (YTP) is similar to YTC, except the holder of a put bond can choose to sell the bond back to the issuer at a fixed price based on the terms of the bond. Yet, we do not have to start simply guessing random numbers if we stop for a moment to consider the relationship between bond price and yield. Dividend Yield, Kesako en langage boursier ? Yet, unlike current yield, YTM accounts for the present value of a bond's future coupon payments. Yield to Maturity (YTM) for a bond is the total return, interest plus capital gain, obtained from a bond held to maturity. 1 Anglais. It should be clear why most investors prefer to use special programs to narrow down the possible YTMs rather than calculating through trial and error, as the calculations required to determine YTM can be quite lengthy and time-consuming. To calculate a bond's yield to maturity, enter the face value (also known as "par value"), the coupon rate, the number of years to maturity, the frequency of payments, and the current price of the bond. 74%-89% des comptes de clients de détail perdent de l'argent lors de la négociation de CFD. A bond priced above par, called a premium bond, has a coupon rate higher than the realized interest rate and a bond priced below par, called a discount bond, has a coupon rate lower than the realized interest rate. Yield To Maturity correspond au calcul du taux de rendement que rapporte à l'échéance un investissement effectué dans un produit de taux (principalement les obligations). The complex process of determining yield to maturity means it is often difficult to calculate a precise YTM value. Having determined the range of rates within which our interest rate lies, we can take a closer look and make another table showing the prices that YTM calculations produce with a series of interest rates increasing in increments of 0.1% instead of 1.0%. On the one hand, a higher YTM might indicate that a bargain opportunity is available, since the bond in question is available for less than its par value. YTM calculations usually do not account for taxes that an investor pays on the bond. When yield spreads widen between bond categories with different credit ratings, all else equal, it implies that the market is factoring more risk of default on the lower-grade bonds. Bonds can be priced at a discount, at par or at a premium. Yield to maturity is similar to current yield, which divides annual cash inflows from a bond by the market price of that bond to determine how much money one would make by buying a bond and holding it for one year. et investissement, Conseil d'administration ou de surveillance et direction. Traduction de 'yield to maturity' dans le dictionnaire anglais-français gratuit et beaucoup d'autres traductions françaises dans le dictionnaire bab.la. yield trends npl plural noun: Noun always used in plural form--for example, "jeans," "scissors." While municipal, treasury, and foreign bonds are typically acquired through local, state, or federal governments, corporate bonds are purchased through brokerages. An investor knows the current bond price, its coupon payments, and its maturity value, but the discount rate cannot be calculated directly. Yield to maturity is a very important concept for any investor to understand so that when buying bonds, they know their YTM isn't just dependent on the coupon rate that is paid. YTM also makes assumptions about the future that cannot be known in advance. Whether or not a higher YTM is positive depends on the specific circumstances. Description: Calculation of YTM is a complex process which takes into account the following key factors: 1. As interest rates rise, the YTM will increase; as interest rates fall, the YTM will decrease. when the bond is kept until the maturity date (= the…. The annual coupon for the bond is 10%, which is $150 per annum. yield to maturity definition: the total yield (= profit) of a bond, etc. If on the other hand the YTM is lower than the coupon rate, then the bond is being sold at a premium. when the bond is kept until the maturity date (= the original date on which it was planned to pay it back): The bond is due in 2033 with a yield to maturity of 7.2%. 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