Question

Which of followingstatement always describes the relationship current yield and yield maturity?

Answer 1

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❏A bond's current yield is an investment's annual income, including both interest payments and dividends payments, which are then divided by the current price of the security.

❏Yield to maturity (YTM) is the total return anticipated on a bond if the bond is held until it matures

Answer 2

Explanation :

★ A bond's current yield is an investment's annual income, including both interest payments and dividends payments, which are then divided by the current price of the security.

★ Yield to maturity (YTM) is the total return anticipated on a bond if the bond is held until it matures.

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