Series 53: Understanding Yield

Taken from our Series 53 Online Guide

Understanding Yield

Market interest rates may change dramatically during the life of a bond, but the nominal yield of a bond will always reflect the interest rate stated on the bond certificate. The nominal yield is always equal to the coupon rate.

Suppose you want to sell your 6% bond in the market, and similar bonds to yours are being issued today at 8%. No one is likely

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