# Discount yield

**Definition:** [crh] The yield or annual interest rate on a security sold to an investor at a Definition: EF="/?rd=discount">discount. A bond that is sold at $4875 that matures to $5000 has a discount of $125. To calculate the discount yield: (Definition: EF="/?rd=discount">discount divided by the face value of the security) multiplied by the (number of days in the year divided by the number of days to maturity).

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