Bond Yields
The calculation of yield to maturity (YTM) considers all of the following EXCEPT:
YTM = maturity date + par value. YTC = call date + call price. Know the difference.
Complete Analysis & Legal Rationale
Yield to maturity calculation uses the current market price, coupon payments, years to maturity, and par (redemption) value at maturity. Call price and call date are used to calculate yield to call (YTC), not YTM.
Distractor Autopsy (Why Other Options Are Traps)
FINRA exam writers design incorrect distractors using specific calculation mistakes and regulatory misconceptions. Review why each option succeeds or fails:
Current market price is essential for calculating YTM.
Coupon payments are a key component of YTM calculation.
Matches the verified teaching point in the explanation.
Par value at maturity (redemption value) is part of YTM calculation.
Official Standard: Outline-level citation pending rule-specific upgrade. Verify against current FINRA Series 7 outline.