| Stripped Yield |
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The implied sovereign yield of a bond or the theoretical yield of the non-collateralized
portion of the bond.
Because many Brady Bonds have built-in features of interest and principal guarantees to attract secondary market investors, stripping out these enhancements allows investors to better understand
the underlying sovereign risk of the bond.
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In other words, the yield on all of the cashflow from the part
of the bond that is not guaranteed by US zero-coupon bonds. |
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Dictionary
