yield equivalence
the rate of interest at which a tax-exempt bond and a taxable security of similar quality provide the same return.
Yield Equivalence
Investment Dictionary:
Yield Equivalence
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Yield Equivalence
The interest rate at which a taxable security and a tax-exempt bond have the same rate of return.
Yield Equivalence. The interest rate at which a tax-exempt bond and a taxable one have the same after-tax return. The theory assumes that both bonds are of similar quality.
See: Yield Equivalence
ERISA (Employee Retirement Income Security Act of 1974)
Federal law passed in 1974 that regulates the establishment, management, operation, and funding of most non-government pension and benefit plans.
See also: Pickup, Yield, Yield Curve, Yield Equivalence, Yield To Call, Yield To Maturity
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Pickup
Pure Yield Pickup Swap ...
Mainly applies to convertible securities. Graph showing the term structure of interest rates by plotting the yield of all bonds of the same quality with maturities ranging from the shortest to the longest available.
Yield equivalence ...
yield elbow The point on the yield curve at which the economy's highest interest rate occurs yield equivalence The necessary yield on a taxable investment in order to balance the tax-free...
 See also: Yield curve, Banks, Time to maturity, Tax-exempt bond, Yellow sheets
  
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