Yield To Maturity (YTM)

  

Categories: Bonds, Muni Bonds

This is the money that a bondholder will enjoy by holding the bond until it matures. The amount you make assumes that the interest payments the bond gave you are all reinvested, so yield to maturity will change over time as the reinvestment rate changes.

Since there are so many variables (such as how much you'll earn when you reinvest your payments) the formula for figuring out YTM is complicated. It's a handy number to figure out, though, as it can tell you whether you're better off selling a bond early...or keeping it for a long while. Maybe even until you're mature.

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finance a la shmoop what is term to maturity alright people well it's kind

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of a lifecycle of a bond like a bond is issued or sold it has an assay a 15 year [Bond timeline appears]

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duration somebody's written that money for 15 years its term to maturity when

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it first was issued was 15 years but if you bought that bond nine years into it

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some you know maturation process when all the hairs growing in funny places [Hairs grow out of bond]

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then at that point it would have six years current maturity well what goes on

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between these years interest payments and then eventually at the very end the

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issuer pays back the principal to the investor who bought the bond and [Money transfers from issuer to investor]

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everyone goes away happy-ish well bonds carry gradations in short medium and

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long term terms to maturity like short term generally is considered one to five [Different types of bond appear]

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years mid term medium term and something like that is like five to a dozen years

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that dozen or so no hard lines here they're all dotted and yeah Disney [Man discussing bonds at DisneyLand]

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Finance: What is Yield to Maturity?
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What is Yield to Maturity? When calculating bond yields, the yield to maturity is the interest rate that an investor would ultimately accumulate if...

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