what is the difference between yield to maturity and current yield？

Question

Question

Answer 1

Answer #1

Current yield is used to measure the relationship between the current price of bonds and the annual interest earned by bonds, where as YTM is an expected rate of the return associated with bonds.
YTM measures the total return on the investment, while, Current yield does not.
When bond is bought at a discounted face value, the YTM will be more than that of the Current Yield because the discount increases the yield. And, if a premium is paid for the bond, the YTM will be less to the current yield.

Answer 2

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