Calculating the actual price of the security in the Wall ...

Yield to maturity. The yield to maturity (YTM) of a bond is the interest rate that makes the present value of the cash flows receivable from owning the bond equal to the price of the bond. Mathematically, it is the interest rate (r), which satisfies the equation. P = C1 + C2__ + C3__ + Cn___ + TV_ (1 + r) (1 + r)2 (1 + r)3 (1 + r)n (1 + r)n. P = Price of the bond. C = Annual interest. M = maturity value. N = … ................
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