Vladimir Putin calls Donald Trump to congratulate him. President-elect Donald Trump talked to Russian President Vladimir Putin on Monday. Trump was repeatedly attacked for praising the autocratic Putin during the election, particularly in light of allegations that Russia attempted to influence the campaign.
If you purchase a bond with a 6.0% coupon at par, its yield to maturity is 6.0%. If you pay more than par, the yield to maturity will be lower than the coupon rate. If purchased below par, the bond will have a yield to maturity higher than the coupon rate. When the price of a tax-exempt bond increases above its par value, it is said to be selling at a premium. When the security sells below par value, it is said to be selling at a discount. previous | next.
The current yield is a good approximation of the bond's yield, if the bond is selling at or near its face value or if it has a long maturity. That is, we noted earlier that if a bond is selling at par, its coupon rate is equal to the discount rate. In this case, the current yield is equal to the bond's yield to maturity. Thus, the closer the bond's price is to its face value, the closer the current yield is to the bond's yield to maturity. As for maturity, note that a coupon bond with no maturity or repayment of principal, known as a perpetuity or consul, pays a fixed amount of coupons forever. The value of such a bond is: