Chapter 8 of 15
Reading a Security Profile
ISIN, coupon, maturity, YTM, and other key metrics
8 min read
What do all these data points mean?
Key Identifiers
ISIN (International Securities Identification Number): Unique 12-character code. DE = Germany, followed by 9 alphanumeric characters + check digit. Example: DE0001102309 (10-year Bund). WKN (Wertpapierkennnummer): German 6-character identifier (legacy).
Core Metrics
| Metric | Definition | Example |
|---|---|---|
| Coupon Rate | Annual interest payment as % of face value | 2.50% |
| Maturity Date | When principal is repaid | 15-Aug-2033 |
| Face Value | Nominal amount (Nennwert) | €1,000 |
| Price | Current market value as % of face value | 98.50 (= €985) |
| Accrued Interest | Interest earned since last coupon payment | €12.50 |
| Dirty Price | Clean price + accrued interest | 99.75 |
| Yield to Maturity (YTM) | Total annualized return if held to maturity | 2.75% |
Price Quotation
- Bonds are quoted as a percentage of face value
- Price of 100 = trading at face value (par)
- Price of 98 = trading at 2% discount
- Price of 102 = trading at 2% premium
Yield to Maturity (YTM)
The most important metric for comparing bonds. It represents the internal rate of return if you hold to maturity. Assumes all coupons are reinvested at the same rate. Accounts for: coupon payments, current price, face value, time to maturity.
YTM vs. Coupon Rate
- If price = 100: YTM = Coupon Rate
- If price < 100: YTM > Coupon Rate
- If price > 100: YTM < Coupon Rate
REAL BUND SECURITY PROFILE
ISIN: DE0001102309 Issuer: Federal Republic of Germany Coupon: 2.50% Maturity: 15-Aug-2033 Price: 97.85 YTM: 2.78% Rating: AAA (Moody's Aaa)
KEY TAKEAWAY
YTM is the number that matters most. It tells you your expected annual return accounting for both coupon and price.