One way to estimate the expected return on bonds is to find the yield to maturity on recently-issued bonds with similar characteristics and risks.

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Yield to maturity is a common measure of the expected return on bonds, and it takes into account the current market price of the bond, its coupon rate, and its remaining maturity. By comparing the yield to maturity of a recently-issued bond with similar characteristics and risks, investors can estimate the expected return on their own bond investments.

One Way to Estimate the Expected Return on Bonds Is