What is Bond yield?

A bond's yield is the return it pays as a yearly percentage, based on the price you pay rather than its face value. Current yield is the yearly coupon divided by the price. Yield to maturity also counts the gain or loss you make by holding the bond until it repays its face value.

Why Bond yield matters

Price and yield move in opposite directions, so the yield tells you what a bond pays at today's price.

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