Required Yield

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Dictionary Says

Definition of 'Required Yield'

The return a bond must offer in order to be a worthwhile investment. Required yield is set by the market and sets the precedent for how current bond issues will be priced.
Investopedia Says

Investopedia explains 'Required Yield'

For example, if the required yield increases to a rate that is greater than that of the bond's coupon, the bond will be priced at a discount. In this way, the investor acquiring the bond will be compensated for the lower coupon rate in the form of accrued interest. If the bond is not priced at a discount, investors will not purchase the issue because its yield will be lower than that of the market. The opposite occurs when the required yield decreases to a rate that is less than that of the bond's coupon. In this case, investor demand for the higher coupon will drive the bond's price up, making the bond's yield equivalent to market yield.

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'Required Yield'

  • Advanced Bond Concepts: Yield and Bond Price | Investopedia

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    Learn about required yield and take a closer look at how various yields are calculated. ...
    section of this tutorial, we touched on the concept of required yield. ...

  • Advanced Bond Concepts: Bond Pricing | Investopedia

    http://www.investopedia.com/university/advancedbond/advancedbond2.asp
    ... Required yield or required rate of return is the interest rate that a security
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  • Defeasance Reduces Commercial Real Estate Fees

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    ... Originally, lenders required "yield maintenance", which dictated that borrowers
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  • Handling High-Yield Savings Accounts

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    ... high-yield savings accounts, make sure to gather information about critical aspects
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  • Advanced Bond Concepts: Conclusion | Investopedia

    http://www.investopedia.com/university/advancedbond/advancedbond8.asp
    ... the income an investor receives if he or she holds a bond until maturity; required
    yield is the minimum income a bond must offer in order to attract investors. ...

  • Do I receive the posted dividend yield every quarter?

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    ... stock price changes, so don't mistakenly equate a change in dividend yield with
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  • Advanced Bond Concepts: Duration | Investopedia

    http://www.investopedia.com/university/advancedbond/advancedbond5.asp
    ... n = number of cash flows t = time to maturity C = cash flow i = required yield M =
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  • Get Active In Your Bond Portfolio

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    ... Using a required yield to discount the future cash flows, all else being equal,
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  • Series 7 Study Guide - Customer Accounts - Required Disclosures ...

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    ... Customer Accounts - Required Disclosures. Required Disclosures I. Product
    Mutual Funds: the representative must deliver a prospectus ...

  • Understanding Interest Rates, Inflation And The Bond Market

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    ... sense because the longer the period of time before a cash flow is received, the
    more chance there is that the required discount rate (or yield) will move higher ...

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