YTM (Yield to maturity)

The yield to maturity (YTM) of a bond is the IRR that a buyer would receive if they purchased the bond at the current market price. This is also called the redemption yield.

It does not provide a perfect comparison of bond values, even leaving aside issues such as risk. Interest rates may vary over the life of the bond so that a bond with a lower YTM may be a better buy because the timing of payments may mean it provides a better return compared to market rates. It is, nonetheless, generally a much better measure than flat yield.