Questions: Yield Issue Date Maturity date Coupon rate
Transcript text: Yield
Issue Date
Maturity date
Coupon rate
Solution
Answer
Yield: The rate of interest a bond actually earns considering its actual cost
Issue Date: The date a bond is actually sold to investors
Maturity Date: The date a bond will be paid back to investors
Coupon Rate: The stated rate of interest a bond will earn
Explanation
Yield
The yield of a bond refers to the rate of interest it actually earns, taking into account its actual cost, which includes the purchase price and any fees. It is a measure of the return on investment for the bondholder.
Issue Date
The issue date is the date on which a bond is actually sold to investors. This is when the bond is first made available for purchase in the market.
Maturity Date
The maturity date is the date on which the bond will be paid back to investors. On this date, the principal amount of the bond is returned to the bondholder, and the bond is considered to be fully matured.
Coupon Rate
The coupon rate is the stated rate of interest that a bond will earn. It is the annual interest rate paid by the bond issuer to the bondholder, typically expressed as a percentage of the bond's face value.