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Home > QFINANCE Dictionary > Definition of yield to maturity

Definition of

yield to maturity

Stockholding & Investments

investor's total return if security held to maturity the total return to an investor if a fixed interest security is held to maturity, in other words, the aggregate of gross interest received and the capital gain or loss at redemption, annualized.

Related definitions of "yield to maturity"

Recommended Further Reading (Term count)
  • Capital Budgeting: The Dominance of Net Present Value
    by Harold Bierman, Jr
    A capital budgeting decision is characterized by costs and benefits that are spread out over several time periods. This leads to a requirement that the time value of money be considered in order to evaluate the alternatives correctly. Although to make decisions we must consider risks as well as time value, I restrict the discussion to situations in which the costs and benefits are known with certainty. There are sufficient difficulties in just...
  • Current Price of a Bond
    The narrow range within which a given bond price falls, based on that bond’s current asking price and bid price.
  • Portfolio Analysis: Duration, Convexity, and Immunization
    Duration is a measure of how sensitive the price of bonds are to changes in interest rates (otherwise known as interest rate risk). For example, if interest rates rise 1%, a bond with a two-year duration will fall about 2% in value. Convexity is a measure of how prices rise when yields fall, and can also be used to measure interest rate risk.
  • Bond Yield
    The annual return on this certificate (the rate of interest) expressed as a percentage of the current market price of the bond.

Definitions of ’yield to maturity’ and meaning of ’yield to maturity’ are from the book publication, QFINANCE – The Ultimate Resource, © 2009 Bloomsbury Information Ltd. Find definitions for ’yield to maturity’ and other financial terms with our online QFINANCE Financial Dictionary.

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