When the time from the settlement date to WAMD is one year or less, mortgage-backed securities are quoted according to Canadian money market convention (i.e. simple interest on an actual/365 day basis). A semi-annual bond yield is converted to a simple interest yield using the formula:
where t=WAMD - Settle + 14 days
Note that 14 days is added to the time between WAMD and the settlement date to account for the fact that payments are made on the 15th of each month, 14 days after the record date.
By re-arranging the above formula, a money market rate can be converted to a bond-equivalent yield: