Price and yield act like opposite sides of a seesaw for a fixed set of promised payments.
01
Go deeper
Current yield is annual coupon income divided by price. Yield to maturity also incorporates the repayment value and timing. A higher quoted yield is not necessarily a better or safer investment.
02
Make it concrete
Hypothetical illustration. A bond paying $40 a year has 4% current yield at $1,000, and 5% at $800. These exclude any gain or loss at repayment.
03
When you read a headline
Do not confuse coupon, current yield and yield to maturity.