Question: What is a relation between realized compound yield and holding period return for a bond paying coupons annually and maturing in 5 years if this
What is a relation between realized compound yield and holding period return for a bond paying coupons annually and maturing in 5 years if this bond is hold for one year?
a.
Cannot be found since the relation depends on yield to maturity
b.
They are the same
c.
Cannot be found since the relation depends on reinvestment rate of coupons
d.
Realized compound yield is always smaller than holding period return
e.
Realized compound yield is always bigger than holding period return
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