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If corporate bond yields decline (and bond prices rise) this ETF could generate significant returns, and it doesn't hurt that investors are buying in at a 4.5% yield.
Current Yield – But now consider how yield changes if the price of that same bond falls. If the bond mentioned above is resold for $800 it results in a current yield of 6.25%.
May yield more than government bonds. Corporate bonds tend to pay out more than equivalently rated government bonds. For example, corporate rates are generally higher than rates for the U.S ...
High grade corporate bonds usually trade at market interest rate but low grade corporate bonds usually trade on credit spread. [12] Credit spread is the difference in yield between the corporate bond and a Government bond of similar maturity or duration (e.g. for US Dollar corporates, US Treasury bonds).
Various related yield-measures are then calculated for the given price. Where the market price of bond is less than its par value, the bond is selling at a discount. Conversely, if the market price of bond is greater than its par value, the bond is selling at a premium. For this and other relationships between price and yield, see below.
The yield on the benchmark 10-year Treasury, which rises as the price of the bond falls, briefly surged above the 4.8% mark Monday morning, its highest level since November 2023, while its 30-year ...
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