In this section of our class, we discussed the sources of returns from investment in a bond. When we invest in a fixed coupon paying bond, we get returns from the following three sources:
—Coupon
—Coupon Reinvestment Income
—Capital Gain/Loss
We also showed the step by step calculation of these return sources. We discussed the concept of YTM and showed the calculation of YTM from
these three sources.
![](https://i.ytimg.com/vi/Ru-uPX0CeEQ/mqdefault.jpg)