YTM of a fixed income instrument is the yield (return on investment) if you buy the instrument at its current price and hold it till its maturity. When calculating yields, both interest payments and principal payment on maturity should be taken into consideration. Remember, YTM can change over time depending on interest rate movement. When interest rates rise, YTM will also rise and vice versa. YTM of a debt fund is weighted average YTMs of individual instruments in the scheme’s portfolio.