What is the difference between Coupon rate and Yield?
The Coupon Rate represents the fixed annual interest rate a bond pays based on its face value. In contrast, Yield refers to the total return an investor can expect from a bond, considering its price, coupon payments, and maturity. Yield accounts for current market conditions and reflects the bond's overall return, which can vary over time.
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What is the difference between YTC, YTM, and Coupon?
YTC (Yield to Call): YTC refers to the yield an investor would receive if a callable bond is held until its call date, considering the bond's market price and the call price. Callable bonds give the issuer the option to redeem the bonds before the ...
What is the tax rate on the interest earned from bonds?
Interest Income from Bonds Interest earned on bonds is generally taxable as part of an individual's total income and taxed according to their income tax slab. For instance, if Mr. Anuj invests Rs. 10,00,000 in a taxable bond yielding 15% annually, ...
What is the difference between Face Value and Investment Amount?
The Face Value of a bond refers to the predetermined amount at which the issuer will redeem the bond at its maturity. On the other hand, the Investment Amount represents the minimum sum required to purchase a bond, as set by the issuer. In essence, ...
IRR vs Return on Investment (ROI)
The major difference between ROI and IRR is the time value of money. ROI is simply the growth rate of your investment, be it even 100 years. It is not an annual rate of return. Whereas IRR takes into account the period of the investment. IRR is used ...
What happens if the user consumes less power than generated by the solar panels in a given month?
The excess power is fed back to the grid at a predetermined rate, which is typically the same rate at which consumers purchase power from the grid. This process is known as net metering, where the surplus electricity is fed back into the grid, and ...