Yield to Maturity or YTM is the rate of return that the investor will receive if the investment or bond is held till the maturity date. It takes into four factors namely, face value, coupon rate, current market rate and time till maturity. It is also referred to as the redemption yield.

Often this term is confused with the coupon rate which is the interest paid out on the face value of bonds. However, YTM is a broader term and includes coupon rate in its calculations.