- CFA Exams
- CFA Level I Exam
- Topic 6. Fixed Income
- Learning Module 46. Understanding Fixed-Income Risk and Return
- Subject 1. Sources of Return
CFA Practice Question
The actual yield to maturity earned at the end of the bond's life may differ from the expected yield to maturity at purchase because of ______.
A. interest rate risk
B. interest volatility
C. reinvestment rate risk
Explanation: The coupon reinvestment rate need to be the same as the expected YTM.
User Contributed Comments 1
| User | Comment |
|---|---|
| Pooh | 2 key factors of reinvestment risk: maturity & coupon rate |