Yield To Call

What is 'Yield To Call'

Yield to call is the yield of a bond or note if you were to buy and hold the security until the call date. This yield is valid only if the security is called prior to maturity. The calculation of yield to call is based on the coupon rate, the length of time to the call date and the market price.

BREAKING DOWN 'Yield To Call'

Generally speaking, bonds are callable over several years and are normally called at a slight premium.

RELATED TERMS
  1. European Callable Bond

    A bond that can be redeemed by the issuer at a predetermined ...
  2. Realized Yield

    The actual amount of return earned on a security investment over ...
  3. Call Privilege

    The provision in a bond indenture that gives the bond issuer ...
  4. Hard Call Protection

    The period in the life of a callable bond during which the issuing ...
  5. Effective Yield

    The yield of a bond, assuming that you reinvest the coupon (interest ...
  6. Running Yield

    The annual income on an investment divided by its current market ...
Related Articles
  1. Professionals

    Typical Yield Measures

    CFA Level 1 - Typical Yield Measures. Learn the various measures of yield on a bond. Includes yield to first call, first par call, put, refunding and yield to maturity.
  2. Bonds & Fixed Income

    Advanced Bond Concepts: Yield and Bond Price

    In the last section of this tutorial, we touched on the concept of required yield. In this section we'll explain what this means and take a closer look into how various yields are calculated. ...
  3. Professionals

    Assumptions Underlying Traditional Yield Curve Measures

    CFA Level 1 - Assumptions Underlying Traditional Yield Curve Measures. Learn the two main assumptions underlying yield measures and the limitations of the six different methods of yield.
  4. Bonds & Fixed Income

    Bond Call Features: Don't Get Caught Off Guard

    Learn why early redemption occurs and how to avoid potential losses.
  5. Bonds & Fixed Income

    Calculating Yield to Worst

    Yield to worst is the lowest possible yield on a bond that may be called in the future.
  6. Bonds & Fixed Income

    Simple Math for Fixed-Coupon Corporate Bonds

    A guide to help to understand the simple math behind fixed-coupon corporate bonds.
  7. Investing

    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.
  8. Professionals

    Calculating Yields

    When an investor purchases a bond in the secondary market at a discount, the discount must be accreted over the remaining life of the bond. The accretion of the discount will result in a higher ...
  9. Bonds & Fixed Income

    Comparing Yield To Maturity And The Coupon Rate

    Investors base investing decisions and strategies on yield to maturity more so than coupon rates.
  10. Professionals

    Bond Yields

    FINRA/NASAA Series 65: Section 8 Bond Yields. In this section yield to maturity, current yield, yield to call and real interest rate.
RELATED FAQS
  1. What is the difference between yield to maturity and the yield to call?

    Determining various the various yields that callable bonds can provide investors is an important factor in the bond purchasing ... Read Answer >>
  2. What is the difference between yield to maturity and the coupon rate?

    Read about some of the basic differences between a debt security's coupon rate and its yield to maturity, and learn which ... Read Answer >>
  3. Can I use the current yield to compare a bond to an equity investment?

    Learn about the different types of yield measurements for stocks and bonds, and find out how to make careful comparisons ... Read Answer >>
  4. How do I calculate yield to maturity of a zero coupon bond?

    Find out how to calculate the yield to maturity for a zero coupon bond, and see why this calculation is more simple than ... Read Answer >>
  5. How can I use the holding period return yield to determine whether or not I should ...

    Find out how to use the holding period return yield formula to determine whether it is a good time to sell your bond based ... Read Answer >>
  6. What is the difference between the yield of stock and the yield of a bond?

    Explore and understand the various meanings of the investment term "yield" as it is applied to equity investments and bond ... Read Answer >>
Hot Definitions
  1. Goodwill

    An account that can be found in the assets portion of a company's balance sheet. Goodwill can often arise when one company ...
  2. Return On Invested Capital - ROIC

    A calculation used to assess a company's efficiency at allocating the capital under its control to profitable investments. ...
  3. Law Of Demand

    A microeconomic law that states that, all other factors being equal, as the price of a good or service increases, consumer ...
  4. Cost Of Debt

    The effective rate that a company pays on its current debt. This can be measured in either before- or after-tax returns; ...
  5. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  6. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
Trading Center