A bond's coupon vs. current yield vs. yield to maturity: StreetSmarts

In this episode of StreetSmarts with Howe & Rusling, Charity Willett, Fixed Income Associate, goes beyond the bell to teach us about the difference between a bond's coupon, current yield, and yield to maturity.

[@aperson2020]

Wow, so beautifully explained. The straight scoop. Well done. Great voice.

[@marisa4942]

Thank you! Very clear explanation of these confusing concepts ;)

[@maialbinkhalil8826]

You cleared out the confusion, thank you

[@comalausa]

Thanks. Simple and clear.

[@Mungo9500]

Excellent Video !!!

[@mauricioschuppli9717]

Really helpful, thanks!

[@sujathasabarishvar1081]

Very clear explanation. Thank u

[@AMehta-pd3kw]

Thank you so much

[@sethidinabandhu2596]

It must be (200/10500)*100 which is 1.90. If we calculate as you said: (0.02/10500)*100 , then it is 0.00190. Coupon amount helps to know the current yield.

[@luneelferdaous6015]

what is the 200 for? what does represent? isn't it supposed to be 0,02?

[@simemesi]

@@luneelferdaous6015 2% out of 10 000$ = 200$

[@kenjskjsk]

Thank you for clarifying!

[@sedditguy1836]

thank you!

[@ankurajay3933]

AMAZING

[@florencewashoma7846]

Thank you

[@saharalasmari833]

Good explanation

[@ponzianomanning3071]

Now I'm ready to buy my 1st T Bond.

[@alexandrestamkos7488]

she needs to replace my finance teacher asap

[@pijiu7246]

thank

[@NickyP1]

Does the same apply to T bills? I.e., would a 4 week non-coupon t bill at a 4% maturity to yield rate recoup that 4% interest + the principal at maturity, or would it only recoup the difference between the par and the purchase price?

[@howerusling165]

A zero-coupon bond doesn't pay any interest, so the YTM purely comes from getting the full face amount (after buying it initially at a discount) when the bond matures! (in your example, the T-bill)

[@aaronhornanfinance-bu8ft]

beautiful

[@gibbonschip]

Very clear. I'm puzzled by the price. Say I'm buying a t-bill for $1000 and it's got a YTM of 5%. But the price is something like 99.668. Paying $99 for a $1000 t-bill would be a huge yield so that's not what's going on. From watching your video, it sounds like that price means 99.668 cents on the dollar. Right?

[@howerusling165]

That's correct Chip!

[@gibbonschip]

@@howerusling165 Thanks!

[@iceyred6668]

HART-/C-MarfKieTY //nd.D

[@iceyred6668]

HART-/C-MarfKieTY //nd.D

[@iceyred6668]

HART-/C-MarfKieTY //nd.D

[@iceyred6668]

HART-/C-MarfKieTY //nd.D