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Term To Maturity

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Definition of 'Term To Maturity'

The remaining life of a financial instrument. In bonds, it is the time between when the bond is issued and when it matures (maturity date), at which time the issuer must redeem the bond by paying the principal (or face value).
Investopedia Says

Investopedia explains 'Term To Maturity'

A bond's term to maturity is mainly used in reference to a bond's yield to maturity, which is a widely used figure that compares bonds of varying maturities. Typically, the longer the term, the greater the yield and vice versa.

Related Definitions

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    Maturity

    1. The length of time until the principal amount of a bond must be repaid. 2. The end of the life of a security.
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  • Yield To Maturity - YTM

    The rate of return anticipated on a bond if it is held until the maturity date. YTM is considered a long-term bond yield expressed as an annual rate. The calculation of YTM takes into ...
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  • Bond

    A debt investment in which an investor loans money to an entity (corporate or governmental) that borrows the funds for a defined period of time at a fixed interest rate. Bonds are used ...
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    • Face Value

      The nominal value or dollar value of a security stated by the issuer. For stocks, it is the original cost of the stock shown on the certificate. For bonds, it is the amount paid to the ...
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    • Par Value

      1. The face value of a bond. 2. A dollar amount that is assigned to a security when representing the value contributed for each share in cash or goods.
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    • Maturity Date

      The date on which the principal amount of a note, draft, acceptance bond or other debt instrument becomes due and is repaid to the investor and interest payments stop. It is also the ...
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    • Tenor

      The amount of time left for the repayment of a loan or contract or the initial term length of a loan. Tenor can be expressed in years, months or days.
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    • Average Effective Maturity

      For a single bond, it is a measure of maturity that takes into account the possibility that a bond might be called back to the issuer.For a portfolio of bonds, average effective maturity ...
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