Current yield - Financial definition
Financial acronyms
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Concise definition of the term current yield
Current yield expresses the return a bond investor receives from the income component (coupon) of a bond as a percentage of its current price.
Comprehensive definition of the term current yield
As an example, let's use a 5-year bond with an annual coupon of 5%, and a price of 109.16. To calculate the current yield, divide the annual coupon rate by the bond's current price, which gives us a current yield of 4.58%.