Calculate bond current yield, yield to maturity (YTM), annual coupon income, and total interest. Essential for fixed-income investing.
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YTM ≈ (Coupon + (Face − Price) / Years) / ((Face + Price) / 2)CouponAnnual coupon payment = Face Value × Coupon RateCurrent YieldAnnual Coupon ÷ Current Market Price × 100YTMApproximate Yield to Maturity (annualized total return if held to maturity)Premium/DiscountCurrent Market Price − Face Value (positive = premium, negative = discount)A bond's yield to maturity (YTM) is the total return you receive if you hold the bond until maturity, accounting for both coupon payments and the gain or loss from buying below or above face value. Bonds trade at a discount when market rates rise above the coupon rate, and at a premium when market rates fall below the coupon rate.
Bonds are a cornerstone of diversified investment portfolios, providing predictable income and capital preservation. Understanding bond yield, particularly yield to maturity, is essential for comparing fixed-income investments and making informed decisions. This bond calculator provides instant yield analysis for any bond at its current market price.
Enter the bond's face (par) value, annual coupon rate, years remaining to maturity, and current market price. The calculator computes the annual coupon payment, total interest income, current yield, approximate yield to maturity (YTM), and whether the bond is trading at a premium or discount to face value.
This calculator helps investors compare bonds with different coupon rates and prices on an apples-to-apples yield basis, understand the income they will receive, and evaluate whether a bond's YTM meets their investment requirements given its price and risk characteristics.
A common mistake is comparing coupon rates directly without considering the market price. A 6% coupon bond trading at $1,100 has a lower effective yield than a 5% coupon bond at $900. Always compare bonds using YTM, not coupon rates. Also note that this calculator uses the approximation formula for YTM — for precise YTM, a full iterative calculation is needed.
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