YTW is a more useful measure of bond attractiveness because it is forward-looking, reflecting the potential return an in | Hanami
YTW is a more useful measure of bond attractiveness because it is forward-looking, reflecting the potential return an investor can earn under the bond’s contractual redemption scenarios. Current yield is simply a snapshot of coupon income relative to today’s price. For institutional investors focused on underwriting future returns, YTW provides a much more meaningful starting point.
Retweeted by @centrifuge from @anemoyanil