Which term refers to the yield of a bond expressed in basis points?

The yield of a bond expressed in basis points is commonly referred to as yield to maturity. Yield to maturity (YTM) represents the total return an investor can expect to earn if the bond is held until it matures. It takes into account all future cash flows from the bond, including interest payments and the return of principal, and expresses this in terms of an annualized rate.

Basis points are a unit of measure used in finance to describe the percentage change in the value or rate of a financial instrument, where one basis point is equal to 1/100th of a percentage point. Therefore, when discussing bond yields and returns, using basis points provides a clear and precise way to communicate relatively small changes or differences in yields, making it easier for investors to understand the potential variations in the return of their investments.

While the other terms listed may relate to bonds, they do not specifically refer to the yield expressed in basis points. The coupon rate pertains to the fixed interest payments made to investors, and credit risk relates to the risk of default by the issuer. Bond points is not a standard financial term used to describe yield, thus reinforcing that yield to maturity is the correct choice in this context.