Bond Yield Calculator
Calculate yield to maturity, current yield, and more for your bonds
Additional Information and Definitions
Bond Face Value
Par value of the bond, typically $1,000 for corporate bonds
Purchase Price
The amount you paid to buy the bond
Annual Coupon Rate
The annual coupon rate (e.g. 5 means 5%)
Years to Maturity
The number of years until the bond reaches maturity
Tax Rate
Your applicable tax rate on coupon income and capital gains
Compounding Periods per Year
Number of times interest compounds annually (e.g. 1=Annual, 2=Semiannual, 4=Quarterly)
Estimate Your Bond Yields
Factor in tax rate, purchase price, face value, and more
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Understanding Bond Yield Terms
Key terms to help you understand bond yield calculations
Face Value (Par Value):
The amount the bondholder will receive upon maturity, typically $1,000.
Coupon Rate:
Annual interest rate paid by the bond, expressed as a percentage of face value.
Yield to Maturity (YTM):
The bond's overall return if held until maturity, factoring in coupon payments and price discount/premium.
Current Yield:
Annual coupon divided by the current market price of the bond.
Effective Annual Yield:
The annual yield considering the effects of compounding over multiple periods per year.
5 Little-Known Facts About Bonds That May Surprise You
Bonds are often seen as conservative investments, but they can hold a few surprises for new investors.
1.The Zero-Coupon Phenomenon
Some bonds pay no coupon but are sold at a deep discount, allowing for interesting yield calculations that differ significantly from traditional coupon bonds.
2.The Real Impact of Duration
Duration is crucial to understanding how a bond’s price will change in response to interest rate movements. Longer duration bonds can experience bigger price swings.
3.Tax Treatments Vary by Region
Interest on certain government bonds might be tax-exempt in some jurisdictions, altering the after-tax yield significantly.
4.Credit Risk Is No Joke
Even 'safe' corporate bonds carry some risk, and junk bonds can offer tempting yields but also heightened default risk.
5.Callable and Putable Bonds
Some bonds can be called or put by the issuer or holder before maturity, affecting the actual yield if an early call or put occurs.