At this duration, the yield on the $ 5 million investment with guaranteed death benefits of $ 50 million is 5.6 %, which, as noted, is income tax — free and equates to
a pretax equivalent yield of 9.3 %.
Not exact matches
Currently, BXMT's dividend produces an approximate 8.1 %
pretax yield in the current share price and at that level, its tax deduction will provide most individual shareholders in the top bracket in the
pretax equivalent of another 90 bps of
yield.
The tax -
equivalent yield is the
pretax yield that a taxable bond needs to possess for its
yield to be equal to that of a tax - free municipal bond.