Series 52: 5.3.1.3. Yield To Call

5.3.1.3. Yield to Call

Bonds are often issued as callable bonds to protect the issuer against interest rate risk. A callable bond, remember, is one that may be redeemed prior to its maturity date. Bonds are often called when interest rates have declined and the issuer can issue a new set of bonds at a lower interest rate. If a bond has a call date, yield to maturity loses much of its meaning, particularly when the bond is selling at a premium (which occurs when interest rates have fallen).

Yield to call is the yield ass