What is Yield to Maturity (YTM)?

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Accepted Answer

Yield to Maturity (YTM) is the total annualized rate of return an investor can expect to receive if a bond is held until its maturity date, representing the internal rate of return (IRR) that equates the present value of all future cash flows (coupon payments and principal repayment) to the bond's current market price.

Yield to Maturity (YTM)

What is Yield to Maturity (YTM)?

What is the fundamental difference between Yield to Maturity (YTM) and Current Yield, and why is YTM a superior metric for long-term bond valuation?

How is Yield to Maturity (YTM) calculated, and what are the key variables in the bond pricing formula that determine its value?

Why is Yield to Maturity (YTM) the critical metric for comparing fixed-income investments, and how does it function as a benchmark in the Treasury and RWA markets?

What are the primary limitations and assumptions of Yield to Maturity (YTM), and how do these risks impact the realized return for investors in traditional and tokenized RWA bonds?

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