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Effective annual yield |
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Definition of Effective annual yieldEffective annual yieldannualized interest rate on a security computed using compound interest techniques. Effective Annual Yieldannualized rate of return on a security computed using compound
Related Terms:Annual fund operating expensesFor investment companies, the management fee and "other expenses," Annual percentage rate (APR)The periodic rate times the number of periods in a year. For example, a 5% Annual percentage yield (APY)The effective, or true, annual rate of return. The APY is the rate actually Annual reportYearly record of a publicly held company's financial condition. It includes a description of the Annualized gainIf stock X appreciates 1.5% in one month, the annualized gain for that sock over a twelve Annualized holding period returnThe annual rate of return that when compounded t times, would have Bond equivalent yieldBond yield calculated on an annual percentage rate method. Differs from annual Bond-equivalent yieldThe annualized yield to maturity computed by doubling the semiannual yield. Capital gains yieldThe price change portion of a stock's return. Convenience yieldThe extra advantage that firms derive from holding the commodity rather than the future. Coupon equivalent yieldTrue interest cost expressed on the basis of a 365-day year. Current yieldFor bonds or notes, the coupon rate divided by the market price of the bond. Dividend yield (Funds)Indicated yield represents return on a share of a mutual fund held over the past 12 Dividend yield (Stocks)Indicated yield represents annual dividends divided by current stock price. Earnings yieldThe ratio of earnings per share after allowing for tax and interest payments on fixed interest Effective annual interest rateAn annual measure of the time value of money that fully reflects the effects of Effective call priceThe strike price in an optional redemption provision plus the accrued interest to the Effective convexityThe convexity of a bond calculated with cash flows that change with yields. Effective dateIn an interest rate swap, the date the swap begins accruing interest. Effective durationThe duration calculated using the approximate duration formula for a bond with an Effective margin (EM)Used with SAT performance measures, the amount equaling the net earned spread, or Effective rateA measure of the time value of money that fully reflects the effects of compounding. Effective spreadThe gross underwriting spread adjusted for the impact of the announcement of the common Equivalent annual annuityThe equivalent amount per year for some number of years that has a present Equivalent annual benefitThe equivalent annual annuity for the net present value of an investment project. Equivalent annual cash flowAnnuity with the same net present value as the company's proposed investment. Equivalent annual costThe equivalent cost per year of owning an asset over its entire life. Equivalent bond yieldannual yield on a short-term, non-interest bearing security calculated so as to be Equivalent taxable yieldThe yield that must be offered on a taxable bond issue to give the same after-tax Flattening of the yield curveA change in the yield curve where the spread between the yield on a long-term High-yield bondSee:junk bond. Indicated yieldThe yield, based on the most recent quarterly rate times four. To determine the yield, divide Liquid yield option note (LYON)Zero-coupon, callable, putable, convertible bond invented by Merrill Liquid yield option note (LYON)Zero-coupon, callable, putable, convertible bond invented by Merrill Lynch & Co. Nominal annual rateAn effective rate per period multiplied by the number of periods in a year. Non-parallel shift in the yield curveA shift in the yield curve in which yields do not change by the same Parallel shift in the yield curveA shift in the yield curve in which the change in the yield on all maturities is Pure yield pickup swapMoving to higher yield bonds. Realized compound yieldyield assuming that coupon payments are invested at the going market interest Relative yield spreadThe ratio of the yield spread to the yield level. Reoffering yieldIn a purchase and sale, the yield to maturity at which the underwriter offers to sell the bonds Required yieldGenerally referring to bonds, the yield required by the marketplace to match available returns Riding the yield curveBuying long-term bonds in anticipation of capital gains as yields fall with the Stated annual interest rateThe interest rate expressed as a per annum percentage, by which interest Steepening of the yield curveA change in the yield curve where the spread between the yield on a long-term Weighted average portfolio yieldThe weighted average of the yield of all the bonds in a portfolio. YieldThe percentage rate of return paid on a stock in the form of dividends, or the effective rate of interest Yield curveThe graphical depiction of the relationship between the yield on bonds of the same credit quality Yield curve option-pricing modelsModels that can incorporate different volatility assumptions along the Yield curve strategiesPositioning a portfolio to capitalize on expected changes in the shape of the Treasury yield curve. Yield ratioThe quotient of two bond yields. Yield spread strategiesStrategies that involve positioning a portfolio to capitalize on expected changes in Yield to callThe percentage rate of a bond or note, if you were to buy and hold the security until the call date. Yield to maturityThe percentage rate of return paid on a bond, note or other fixed income security if you Yield to worstThe bond yield computed by using the lower of either the yield to maturity or the yield to call Annual ReportThe report required by the Stock Exchange for all listed companies, containing the companyâ€™s financial statements. dividend yield ratioCash dividends paid by a business over the most Bond Equivalent YieldBond yield calculated on an annual percentage rate method Effective Interest RateThe rate of interest actually earned on an investment. It is Yield CurveA graphical representation of the level of interest rates for Yield to MaturityThe measure of the average rate of return that will be earned on a effectivenessa measure of how well an organizationâ€™s goals labor yield variance(standard mix X actual hours X standard rate) - (standard mix X standard hours X standard rate); material yield variance(standard mix X actual quantity X standard price) - (standard mix X standard quantity X standard price); process quality yieldthe proportion of good units that resulted from the activities expended yieldthe quantity of output that results from a specified input yield ratiothe expected or actual relationship between input and output Par yield curveThe yield curve of bonds selling at par, or face, value. Spot curve, spot yield curveSee Zero curve. Yield a. Measure of return on an investment, stated as a percentage of price. Yield curveGraph of yields (vertical axis) of a particular type of security Yield to maturityA measure of the average rate of return that will be earned Zero curve, zero-coupon yield curveA yield curve for zero-coupon bonds; Annual reportA report issued to a companyâ€™s shareholders, creditors, and regulatory Production yield varianceThe difference between the actual and budgeted proportions annual percentage rate (APR)Interest rate that is annualized using simple interest. current yieldannual coupon payments divided by bond price. effective annual interest rateInterest rate that is annualized using compound interest. equivalent annual costThe cost per period with the same present value as the cost of buying and operating a machine. yield curveGraph of the relationship between time to maturity and yield to maturity. yield to maturityInterest rate for which the present value of the bondâ€™s payments equals the price. Current YieldThe percentage return on a financial asset based on the current price of the asset, without reference to any expected change in the price of the asset. This contrasts with yield-to-maturity, for which the calculation includes expected price changes. See also yield. Effective Exchange RateThe weighted average of several exchange rates, where the weights are determined by the extent of our trade done with each country. Policy-Ineffectiveness PropositionTheory that anticipated policy has no effect on output. YieldThe interest rate that makes the present value of a stream of future payments associated with an asset equal to the current price of that asset. Also called yield to maturity. See also current yield. Yield curveA graph showing how the yield on bonds varies with time to maturity. Blue Ribbon Committee on Improving the Effectiveness of Corporate Audit CommitteesA committee formed in response to SEC chairman Arthur Levitt's initiative to improve the financial Effective Tax RateThe total tax provision divided by pretax book income from continuing Panel on Audit EffectivenessA special committee of the Public Oversight Board that was created annual returnThe fund return, for any 12-month period, including changes in unit value and the reinvestment of distributions, but not taking into account sales, redemption, distribution or other optional charges or income taxes payable by any unitholder that would reduce returns. Annual PremiumYearly amount payable by a client for a policy or component. Internal rate of return a. The average annual yield earned by an investment during the period held.
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