In which of the following situations would the yield to worst for a certain bond be that bond's yield to call? I.The bond's coupon payments are high relative to market yields.
II)The bond price is at a discount.
III)The likelihood of the bond being called is high.

Question

Quizplus · Accepted Answer

If a bond's coupon payments are high relative to market yields (I), it is more likely to be called because the issuer can refinance at a lower rate. If the likelihood of the bond being called is high (III), the yield to call becomes the yield to worst.

In Which of the Following Situations Would the Yield to Worst