The differene between HPR and HPY

CFA Level I
#1

Hi Guys, In the Time Value of Money, can someone tell me what is the differene between the “Holding Period Return (HPR)” and the “Holding Period Yield (HPY)” ? Thanks for all replies

#2

I think they mean the same … just different terminology. (PriceEnd - PriceBegin + Cashflows in Period) / PriceBegin

#3

the very slight nuance is HPR: return of investment held over a certain period of time HPY: return of investment held until maturity (just boring terminology…) cpk123 formula is correct

#4

careful D’Artagnan, “certain period of time” is more precisely identified as the holding period, i.e. the “HP” component of “HPR.” Moreover, the holding period can be shorter than the time until maturity, so the terms “holding period” and “maturity” shouldn’t be used interchangeably. Are you possibly thinking of the yield to maturity (YTM), which would only equal the HPR if the fixed income security was held to maturity and its periodic cash flows were reinvested at the YTM…