Yield Maintenance
Yield Maintenance in Commercial Real Estate Loans Yield Maintenance refers to the penalties you pay if you pay off your loan early. The penalty is assessed if you pay off your loan before the agreed-upon term. In most cases, you can avoid paying yield maintenance if you pay off your loan on time. It's better to avoid the penalty than...
Yield Curve
A yield curve depicts interest rates of bonds having different maturities, but same credit quality, at a specific point in time. The yield curve is mostly used to compare rates of different maturity government securities that range from three months to thirty years. This curve also acts as a yardstick for other fixed interest instruments including mortgages and bank...
Yonder 40 Index (Yonder 40)
What is 'Yonder 40 Index - Yonder 40' A list of 40 publicly traded companies chosen for their ties to rural areas. The Yonder 40 is designed to reflect the economies of non-urban areas, and includes companies that are involved in agriculture and livestock raising, in addition to heavier industries such as construction. The index is not...
Yield Elbow
What is 'Yield Elbow' The point on the yield curve indicating the year in which the economy's highest interest rates occur. The yield elbow is the peak of the yield curve, signifying where the highest interest rates occurred. Explaining 'Yield Elbow' Three main types of yield curves exist, including normal, inverted and flat. A...
Yearly Price Of Protection Method
What is 'Yearly Price Of Protection Method' A method used in actuarial analysis, which is often used in the insurance industry. The Yearly Price Of Protection Method is used to find out the cost of protection of a policy that includes a savings component such as a cash value life insurance policy. It relates to computations that...
Yield-Based Option
What is 'Yield-Based Option' A type of debt-instrument-based option that derives its value from the difference between the exercise price and the value of the yield of the underlying debt instrument. Yield-based options are settled in cash. A yield-based call buyer expects interest rates to go up, while a yield-based put buyer expects interest rates to go...
Yellow Sheets
What is 'Yellow Sheets' A United States bulletin that provides updated bid and ask prices as well as other information on over-the-counter (OTC) corporate bonds (also called "corporate"). Companies issue corporate bonds to raise money for capital expenditures, operations and acquisitions. Similar to the Pink Sheets that track non-exchange-traded OTC micro-cap stocks, the yellow sheets are a...
Yield Equivalence
What is 'Yield Equivalence' The interest rate on a taxable security that would render a return equivalent to that of a tax-exempt security, and vice versa, calculated as follows: Explaining 'Yield Equivalence' In order to calculate yield equivalence, divide the tax-exempt yield by 1 minus the investor's tax rate. For example, say you were considering...
Yo-Yo
DefinitionA yo-yo is a toy consisting of an axle connected to two disks, and a string looped around the axle. It has some similarities to a slender. Yo-Yo What is 'Yo-Yo' Yo-yo is slang for a very volatile market; the name comes from the movements of a yo-yo, where security prices continually go up and down. A...
Yield Tilt Index Fund
What is 'Yield Tilt Index Fund' A type of mutual fund that allocates capital as a standard index, by replicating the holdings of a specified stock index, such as the Standard & Poor's 500 Index (S&P 500), except that the fund weights its holdings towards stocks that offer higher dividend yields. Stocks with higher dividend yields are...