What is the 'Discount Yield'
Discount yield is a measure of a bond's percentage return. Discount yield is most frequently used to calculate the yield on shortterm bonds and treasury bills sold at a discount. This yield calculation uses a 30day month and 360day year to simplify calculations. Discount yield is calculated by the following formula:
Discount Yield = [(par value  purchase price)/par value] * [360/days to maturity]
BREAKING DOWN 'Discount Yield'
The 30/360 simplification used in discount yield means that the discount yield figure is a slightly inaccurate measure of an investor's true return on investment. Although more accurate measures of yield are available, discount yield is still used as a matter of convention within the shortterm bond and treasury bill world. This may be partially due to the fact that the yield on U.S. Treasury Bills is most commonly quoted as a discount yield.

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Managing Wealth
4 Types Of Money Market Yields
We give you four equations to help figure out the yields on your investments. 
Markets
Calculating Bond Equivalent Yield
The bond equivalent yield calculates the semiannual, quarterly or monthly yield on a discount bond or note. 
Markets
Understanding the Different Types of Bond Yields
Any investor, private or institutional, should be aware of the diverse types and calculations of bond yields before an actual investment. 
Markets
Understanding Treasury Yield
Treasury yield refers to the return on an investment in a U.S. government debt obligation, such as a bill, note or bond. 
Trading
How To Compare Yields On Different Bonds
Find out how to equalize and compare fixedincome investments with different yield conventions. 
Markets
Bond Yields: Current Yield And YTM
A bond's current yield, also called "bond yield," is the interest it pays annually divided by the bond's price. A stock's current yield, also called "dividend yield," is the sum of its annual ... 
Managing Wealth
Finding A Discount On Your Next Bond Investment
Discount rates have nothing to do with buying things on sale. Rather, it helps you figure out how much to pay today for a bond or cash flow in the future. 
Markets
Interest Rates, Inflation and the Bond Market
Interest rates, bond prices and inflation all have an impact on one another. 
Markets
Calculating Yield to Worst
Yield to worst is the lowest possible yield on a bond that may be called in the future. 
ETFs & Mutual Funds
What You Need To Know About Bond ETF Yields
When it comes to fixed income investing, yield is an important component of a bond investmentâ€™s total return to accurately assess if it's the right move.

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