Explain the concept of yield to maturity
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A co-worker of yours was discussing her investments with a broker. Your coworker was confused because she has purchased a 10% bond, but the broker kept repeating it had a 9% yield to maturity. Explain the concept of yield to maturity to your coworker.
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The bond's yield to maturity (YTM) is the interest rate generally discussed by investors. It is the total rate of return if they bought the bond and held it to maturity. The yield to maturity for a bond ...
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