Yield to maturity considers annual interest, difference between current price and maturity value, and years to maturity.

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Yield to maturity is a measure of return that considers the annual interest received, the difference between the current bond price and its maturity value, and the number of years to maturity. More importantly, yield to maturity is the same concept as the internal rate of return or true yield on an investment. That is, it is the interest rate (i) at which you can discount the future coupon payments (C_t) and maturity value (P_n) to arrive at a known current value (V) of the bond.

Yield to Maturity Considers Annual Interest, Difference Between Current Price