Series 7 - General Securities Representative Exam
Preview Mode
How do you calculate the current yield on a bond?
You take the face value amount and divide by the par value
A
You take the annual interest payments and divide by par value
B
You take the yield to the worst and divide by the par value
C
You take annual interest payments and divide by the cost of the bond
D
Explanations
To figure out CY, Take the annual interest and divide by the market price (cost).