Investors Consider Which of the Following to Be the Most

question 92

Multiple Choice

Investors consider which of the following to be the most important measure of bond returns?

• A) The coupon rate
• B) The yield to maturity
• C) The current yield
• D) None of these options

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Definitions:

Geometric Average Return

The average rate of return on an investment, calculated by multiplying n returns together and then taking the nth root.

Quarterly Returns

The investment gains or losses experienced by an asset or portfolio over a three-month period.

Geometric Average Return

A method of calculating the average rate of return that accounts for the compounding of returns over time.

Quarterly Returns

The investment gains or losses recorded by a fund or portfolio over a three-month period.