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What is the difference between the interest yield and redemption yield?

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Question added by Frank Mwansa , ACCOUNTING LECTURER , FREELANCER
Date Posted: 2016/04/29
Mujeeb Alam
by Mujeeb Alam , Accountant , Copri Construction Enterprises Est.

Dividend Yield;

 

A financial ratio that indicates how much a company pays out in dividend each year relative to its share price. Dividend yield is represented as a percentage and can be calculated by dividing the dollar value of dividends paid in a given year per share of stock held by the dollar value of one share of stock

 

Redemption Yield;

 

Yield to maturity (YTM) is the total return anticipated on a bond if the bond is held until the end of its lifetime. Yield to maturity is considered a long term bond yield but is expressed as an annual rate. In other words, it is the internal rate of return of an investment in a bond if the investor holds the bond until maturity and if all payments are made as scheduled.

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