Bond Yield Calculator
Use this bond yield calculator to find a bond’s current yield and its approximate yield to maturity, based on face value, price, coupon rate, and years remaining.
Understanding the Bond Yield Calculator
A bond’s stated coupon rate is fixed when it’s issued, but the yield you actually earn depends on the price you pay — and bond prices move constantly as interest rates change. When a bond trades below face value (a discount), its yield is higher than the coupon rate. When it trades above face value (a premium), its yield is lower.
This calculator shows two versions of that yield. Current yield is the simplest: just the annual coupon payment divided by the price you paid, which tells you the cash return on your investment today. Yield to maturity (YTM) goes further, factoring in the gain or loss you’ll realize when the bond matures and pays back its full face value — so a discount bond’s YTM is higher than its current yield, and a premium bond’s YTM is lower.
The YTM formula used here is a common approximation, not the exact figure a bond calculator running iterative present-value math would produce. It’s accurate enough for comparing bonds at a glance, but for a bond you’re actually buying, check the yield your broker quotes, since it accounts for exact payment timing.
Bond Yield Calculator Examples
Example 1 — Bond trading at a discount
Example 2 — Bond trading at a premium
Bond Yield Calculator FAQ
The coupon rate is fixed at issuance and is always a percentage of face value. Yield reflects what you actually paid, so it moves whenever the bond’s market price moves — the two only match when a bond trades exactly at face value.
A bond’s coupon payments are fixed in dollar terms. When market interest rates rise, new bonds offer higher coupons, so existing bonds become less attractive unless their price drops — which raises their yield to match. The reverse happens when rates fall.
Yield to maturity is the more complete measure, since it captures both the coupon income and the gain or loss from buying below or above face value. Current yield ignores that price-to-face gap, so it can be misleading for bonds trading far from par.
No — it treats the coupon as a single annual figure for simplicity. Most U.S. bonds actually pay coupons twice a year, which changes the exact YTM slightly; a full present-value calculation is needed to capture that precisely.
It depends entirely on current interest rates and the bond’s risk. A yield is only meaningful relative to comparable bonds — a Treasury bond and a corporate bond of the same maturity will typically have different yields because of differing credit risk.
A premium bond usually carries a coupon rate above current market rates, so even though its yield to maturity is lower than its coupon, it can still offer a competitive yield compared to newly issued bonds — and it delivers higher cash income along the way.
You’ll receive whatever the market price is at that time, which may be higher or lower than what you paid — this calculator’s yield to maturity assumes you hold the bond until it matures and is repaid at face value.