Yield to Maturity Is Always Received as Promised: A Reply

Richard Cebula () and Bill Yang

MPRA Paper from University Library of Munich, Germany

Abstract: This theoretical note elaborates upon why it is a myth that YTM is viewed as only a promised but not really earned interest rate. It addresses some misconceptions in Shirnani and Wilbratte (2009) on what, between YTM and RCY, is a true rate of return of a coupon bond, why YTM is not just a "fictitious mathematical construct," and why YTM has nothing to do with a yield curve.

Keywords: yield to maturity; earned interest rate; yield curve (search for similar items in EconPapers)
JEL-codes: E43 G12 (search for similar items in EconPapers)
Date: 2008-05-15
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Published in Journal of Economics and Finance Education 2.8(2009): pp. 38-41

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:50122

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