| | InvestHub.com's
Finance Dictionary and Glossary of Investment Terms
yield equivalence
Definition 1.
The yield needed on a taxable investment in order to match the tax-free return offered on a municipal bond; calculated by dividing the tax-exempt yield by (1 minus the investor's marginal tax rate). also called equivalent taxable yield.
|
Definition 2.
The interest rate on a taxable security that would render a return equivalent to that of a tax-exempt security, and vice versa.
|
|
|