Yield to Worst – Meaning, Importance, Calculation, and More
The Yield to Worst or YTW is the minimum yield that an investor expects to get on a bond when there is no probability… Read Article
Bond Valuation
Yield to Call – Meaning, Formula, Example and More
Yield to Call or YTC is the return that an investor will earn if they hold the bond until the call date (not maturity… Read Article
Liquidity Preference Theory: Meaning, Curve, Limitations and More
Liquidity Preference Theory: MeaningLiquidity Preference Theory is a theory that suggests that investors demand higher interest rates or additional premiums for medium or long-term… Read Article
Flat Yield Curve – Meaning, Importance, Reasons, and More
A yield curve is a graphical presentation of the yield of bonds or securities of the same credit quality at various maturity levels. And… Read Article
Dirty Price vs Clean Price
Understanding bond pricing is complex, sometimes even for experts. Markets quote bond prices in two different manners. They are dirty price and clean price.… Read Article
Maturity Risk Premium – Meaning, Need, Formula and Interpretation
Maturity Risk PremiumMaturity Risk Premium is basically the extra return that an investor demands or gets for bearing the maturity risk. Usually, the concept… Read Article
Nominal Yield: Meaning, Formula, Example, Components, and Spread
Nominal Yield: MeaningNominal Yield, also known as Nominal rate or Coupon yield, is the interest rate that the bond purchaser receives from the bond… Read Article
Nominal Value – Meaning, Importance, Drawbacks and More
Nominal Value (NV) is a common term used in finance and economics. In the field of finance, we use it primarily for bonds and… Read Article
Current Yield – Meaning, Importance, Formula and More
The current yield is the annual income from a financial instrument or an investment, usually bonds, based on its current price instead of the… Read Article
Term Structure of Interest Rates – All You Need To Know
What is the Term Structure of Interest Rates?The term structure of interest rates or the yield curve is basically a graphical representation showing the… Read Article
Bond Pricing
Bond Pricing/bond valuation is a method of calculating the fair price or value of a bond. The price of a bond is calculated by… Read Article