Investing
Bond Yield Calculator
A bond's coupon tells you what it pays; its price tells you what you paid. Yield is the relationship between the two, and it moves opposite to price — which is why a bond bought at a discount yields more than its printed rate.
The annual interest printed on the bond, as a percent of face value.
Yield to maturity (approx.)
5.64%
Total return if you hold to maturity and reinvest nothing.
- Current yield
- 5.26%
- Annual coupon
- $50
- Discount to face
- $50
Annual coupon ÷ price paid.
Repaid at face value, so this is extra return at maturity.
How this calculator works
Annual coupon = face value × coupon rate. Current yield = coupon ÷ price. Yield to maturity uses the standard approximation: (coupon + (face − price) ÷ years) ÷ ((face + price) ÷ 2).
Assumes annual coupons, no call provisions, no default, and no reinvestment of coupons at any particular rate. Callable bonds should also be checked at their yield to call, which can be materially lower.
Try an example
Frequently asked questions
What's the difference between current yield and yield to maturity?
Current yield is just the coupon divided by what you paid — a snapshot of annual income. Yield to maturity also folds in the gain or loss you book when the bond repays face value at the end, so it is the more complete figure for a buy-and-hold investor.
Why do bond prices fall when rates rise?
Because a bond's coupon is fixed. If new bonds pay 6% and yours pays 5%, nobody buys yours at full price — its price drops until the yield matches what the market offers. The longer the maturity, the more the price has to move, which is why long bonds are the volatile ones.
How accurate is this yield to maturity?
It uses the standard textbook approximation — coupon plus the annualised discount, over the average of price and face. It is within a few basis points for most bonds and perfectly adequate for comparing options. Exact YTM requires solving for the rate that discounts every coupon and the principal back to today.
Does this account for tax?
No. Corporate bond interest is taxed as ordinary income; Treasuries are exempt from state tax; municipal bonds are often exempt from federal tax. For a fair comparison against a muni, run the result through our tax-equivalent yield calculator.
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Disclaimer: DayCents provides this calculator for educational purposes only. Results are estimates based on your inputs and the stated assumptions — they are not financial advice, a quote, or an offer of credit. Consult a qualified financial professional before making major money decisions.