What is Yield to Maturity (YTM)?

Yield to Maturity (YTM) is the total return anticipated on a bond if the bond is held until it matures. It is expressed as an annual rate and takes into account the bond's current market price, par value, coupon interest rate, and time to maturity.

YTM is considered a long-term bond yield but is expressed as an annual rate. It is the internal rate of return (IRR) of an investment in a bond if the investor holds the bond until maturity, with all payments made as scheduled and reinvested at the same rate.