How is bond yield calculated when interest payments are not reinvested?

Question

The most common number used to compare different bonds is yield to maturity (YTM). However, YTM assumes interest payments will be reinvested at the coupon rate (which is unlikely since interest rates can fluctuate anytime). So how does one calculate yield or rate of return on a bond in the case where interest payments are not reinvested at all?

Thanks.

Answer 1

Nominal Yield, the sum of the coupons payable each year divided by the par value.