Tax-Equivalent Yielddoi:10.1007/0-387-26336-5_2028Tax-exempt interest yield converted to a pretax taxable equivalent by dividing the nominal rate by 1 minus the investor's marginal income tax rate.Springer USEncyclopedia of Finance
Tax-Equivalent Yield Formula The tax-equivalent yield is the yield on a taxable bond that an investor would have to earn to match thereturn on a comparable tax-free investment. Depending on an investor's tax bracket, a tax-free vehicle like a municipal bond may not be the best investment ...
Tax-free investments such as municipal bonds have lower yields due to their tax-exempt status. Use this calculator to determine an equivalent yield on a taxable investment. The higher your marginal tax bracket (state and federal), the higher the tax-equivalent yield.Note: This calculator assumes...
This tax equivalent yield calculator will estimate the tax-equivalent yield, or TEY, for a municipal bond. Income generated from municipal bond coupon payments are not subject to federal income tax. In addition, if the bond was issued in the state of residence, you can also avoid state income...
Use the tax-equivalent-yield formula to compare the real return on a muni bond with a corporate bond. The formula is: Tax Equivalent Yield = Tax-Free Yield / (1 – Tax Rate). Translation: That's the yield that the muni must have in addition to its federal tax-free status to be equ...
This tax equivalent yield calculator will estimate the tax-equivalent yield, or TEY, for a municipal bond. Income generated from municipal bond coupon payments are not subject to federal income tax. In addition, if the bond was issued in the state of residence, you can also avoid state income...
The Tax Equivalent Yield Calculator compares the yield of a tax free bond to a taxable bond, to determine which security returns the higher yield. The calculator takes into consideration the marginal federal and state tax rates of the investor. The resulting equivalent yields are computed for ...
such as the federal funds policy rate, remain elevated. second, municipal bond valuations are cheaper than the long-term average. municipal investors often consider a bond's tax-equivalent yield as an important measure. this allows investors to compare municipal yields to other bond yields that do...
The Tax Equivalent Yield Calculator compares the yield of a tax free bond to a taxable bond, to determine which security returns the higher yield. The calculator takes into consideration the marginal federal and state tax rates of the investor. The resulting equivalent yields are computed for each...
Yield to Maturity | Definition, Formula & Equation from Chapter 5 / Lesson 32 173K Learn what yield to maturity (YTM) is. Understand the definition of yield to maturity (YTM) and know how to calculate it. Discover how to ca...