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Answer: Yield to maturity (aka, yield)
The bond indenture typically specifies the bond’s key contractual terms, such as the issuer’s legal identity, par value, coupon rate, maturity, covenants, and any call/put provisions. **Yield to maturity** is not a term set in the indenture; it is a market-derived return measure that depends on the bond’s price and cash flows. Therefore, it is the least likely to be explicitly specified.
Author: Manit Arora
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Q-504.1. Which of the following elements is the LEAST likely to be explicitly specified in the bond indenture?
A
Negative covenants
B
Principal value of bond (aka, par value)
C
Yield to maturity (aka, yield)
D
Legal identity of bond issuer
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