Some fixed-income instruments contain embedded call options. As a result, the issuer has the right to buy back the bond before the stated maturity date. Put simply, the issuer might repay the debt earlier. The yield to call (YTC) represents the bond’s total return, assuming it is held until its call date instead of maturity. So, rather than using the time to maturity, you take the time until the bond is called and the bond’s call price to calculate it. Use the template to estimate the rate of return earned on a callable bond, assuming it’s called at the earliest possible date before maturity.
This open-access Excel template is a useful tool for bankers, investment professionals, corporate finance practitioners, portfolio managers, and anyone preparing a corporate presentation.
Yield To Call (YTC) is among the topics included in the Fixed Income module of the CFA Level 1 Curriculum. Gain valuable insights into the subject with our Fixed Income Investments course.
You can also explore other related templates such as—Yield to Worst, Bond Valuation, and Yield to Maturity.
