Bond (finance) - Features - Yield

Yield

The yield is the rate of return received from investing in the bond. It usually refers either to

  • the current yield, or running yield, which is simply the annual interest payment divided by the current market price of the bond (often the clean price), or to
  • the yield to maturity or redemption yield, which is a more useful measure of the return of the bond, taking into account the current market price, and the amount and timing of all remaining coupon payments and of the repayment due on maturity. It is equivalent to the internal rate of return of a bond.

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