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Qantas 2022 - Busting the Running Yield Myth

by Asmita Kulkarni, CFA | Sep 19, 2018
The price of the Qantas 2022 bond has peaked and is gradually moving towards par as the bond moves closer to maturity. This price movement is eroding the total return of the bond as lower price offsets running yield (yield from coupons). Investors should consider exiting this bond at the current premium and investing in longer dated bonds with higher overall yields.