Coupon Equivalent Yield - CEY
A method of calculation used to calculate the yield on bonds with maturities of less than one year and which normally sell at a discount and do not pay coupons.
Formula
Investopedia Commentary
For example, the CEY calculation allows bond investors to compare the return on a 180-day Treasury bill to a one-year coupon paying bond, to evaluate which instrument will give the investor a higher return.
Related Links
Bond Basics Tutorial
Advanced Bond Concepts
See also: Bond, Coupon, Coupon Bond, Discount, Discount Bond, Interest, Time Value of Money, Yield
Also spelled: CEY