Bond Yield to Maturity (YTM) & Coupon Price Calculator
Calculate bond Yield to Maturity (YTM), current yield, annual coupon cash flow, discount or premium status, and total interest earned over maturity.
Calculated Results
Frequently Asked Questions
What is Yield to Maturity (YTM) and why is it important?
Yield to Maturity (YTM) is the total annualized rate of return expected on a fixed-income bond if held until it matures. Unlike the nominal coupon rate, YTM factors in coupon interest payments, time to maturity, and the capital gain or loss realized between the purchase price and face value.
What is the difference between a bond's Current Yield and YTM?
Current Yield simply divides annual coupon income by the bond's current market price (Coupon / Price). It ignores capital gains or losses when the bond matures at par ($1,000), making it only an immediate snapshot. YTM is the accurate total return metric.
What does it mean if a bond trades at a discount vs. premium?
When market interest rates rise above a bond's coupon rate, the bond's market price drops below par ($1,000 face value), trading at a 'Discount' (YTM > Coupon Rate). Conversely, when interest rates fall, bond prices rise above par to trade at a 'Premium' (YTM < Coupon Rate).
Why do most US Treasury and corporate bonds pay semiannually?
In the United States, municipal, corporate, and US Treasury bonds traditionally pay interest coupons every 6 months (semiannually). This provides investors with consistent biannual cash flow and compounding reinvestment opportunities.