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Q: How do you calculate book yield on a bond?
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How do you calculate book yield?

Book yield, also called yield to maturity can be calculated by the time period rooted of the face value over the present value minus one. The book yield is a percentage that shows how much the bond gains a year until its maturity.


How do you calculate yield?

Book yield, also called yield to maturity can be calculated by the time period rooted of the face value over the present value minus one. The book yield is a percentage that shows how much the bond gains a year until its maturity.


Define bond yield?

is the yield of a bond in the market


What is book yield?

The "book yield" is a measure of a bond's recurring realized investment income that combines both the bond's coupon return plus its amortization. It is defined as the bond's Internal Rate of Return (IRR) of all its cash flows. The following example illustrates the concept of book yield. A $100 par bond having a 5% coupon to be paid annually at year end is purchased for a $95 purchase price at the beginning of the year. The bond is set to mature in three years. In this example, the book yield will be greater than the 5% coupon on the discount bond as the investor will receive both the 5% coupon and the difference between purchase price and maturity value (an additional $5). The book yield at purchase will be 6.90%, which is the internal rate of return or IRR of the cash flows. The $5 discount is amortized into income over the life of the bond and the book value of the bond is increased until it reaches its par value of $100 at maturity.


Will the yield on a 2 year corporate bond exceed the yield on a 2 year treasury bond?

The yield on a 2 year corporate bond will always exceed the yield on a 2 year treasury bond


The yield on a 2 year corporate bond will always exceed the yield on a 2 year treasury bond?

The yield on a 2 year corporate bond will always exceed the yield on a 2 year treasury bond


If the bond's price increases will it increase or decrease bond's yield?

neither once the bond is created the yield is set. the bond price is simply a reflection of the current rate and the rate, 'yield' of the bond.


Does the yield to maturity represent the promised or expected return on the bond?

The yield to maturity represents the promised yield on a bond


Relationship between bond price and yield?

what is relationship between bond price and yield?


If the yield curve is downward sloping what is the ytm on a 10 year Treasury coupon bond relative to that on a 1 year T-bond?

If the yield curve is downward sloping, the yield to maturity on a 10-year Treasury coupon bond relative to that on a 1 year T-bond is the yield on the 10 year bond. It will be less than the yield on a 1-year bond.Ê


If a coupon bond is selling at par does the current yield equal its yield to maturity?

Yield usually refers to yield to maturity. If a bond is trading at par it usually means the yield to maturity is equal to the coupon.


What is relationship between bond price and yield?

A bond yield is the price of a bond that an investor will hold said bond to maturity at. This relates to price as the price dictates when the investor will sell their bond.