| Word |
Synonym / Acronym |
Definition |
| Yield Curve |
|
A graph comparing interest rates to maturity for fixed income investments. It curves upward to the right indicating lower yields for short maturities during normal market environments. |
| Yield Spead |
|
The difference or "spread" between yields on different classes of bonds. |
| Yield to Call |
|
The discount rate that equates the present value of the bond's future cash flows through its first call date relative to the current market price of the bond. Impossible to calculate exactly since one has no knowledge of what a reinvestment rate will be in the future. |
| Yield to maturity (YTM) |
Total Return or Bond Internal Rate of Return |
The discount rate that equates the present value of the bond's future cash flows through to maturity relative to the current market price of the bond. Impossible to calculate exactly since one has no knowledge of what a reinvestment rate will be in the future. |
| Zero Coupon Bond |
|
A bond that is offered at a deep discount rather than paying interest. |
