What Is the Bond Yield Calculator?
A bond yield calculator converts a bond's price and coupon into the return you can expect. It computes the current yield (based on price today) and an approximate yield to maturity that accounts for any gain or loss if you hold the bond to redemption.
How to use this calculator
Type your numbers into the fields above. The results change the moment you edit any input, so you can try one scenario after another and see exactly what moves. Most calculators show a short summary of the key figures, a line-by-line breakdown underneath, and — where it applies — a year-by-year schedule you can export to a spreadsheet. Everything runs in your browser; nothing is stored or sent anywhere. Treat the output as a planning estimate, not as final word on a real decision.
The Formula
Current yield = annual coupon ÷ market price. Approximate YTM = (annual coupon + (face value − price) ÷ years) ÷ ((face value + price) ÷ 2). When priced below face, YTM exceeds the coupon; when above face, it is lower.
Worked Example
A $1,000 face bond with a 5% coupon trading at $950 and 10 years to maturity pays $50 a year, for a current yield near 5.26%. The discount to face adds about $5 a year, lifting the approximate YTM to roughly 5.8%.
Tips for the Most Accurate Estimate
- Bonds below face (discount) raise your effective yield.
- Longer maturities amplify price sensitivity to rate changes.
- Compare YTM across bonds, not just the coupon rate.
- Factor in credit risk — higher yields often mean higher risk.
- Use YTM for buy-and-hold decisions; current yield for income now.
Frequently Asked Questions
Q: Current yield vs YTM — which matters?
Current yield shows income relative to today's price; YTM includes the gain or loss to maturity and is the better measure if you hold to redemption.
Q: Why is YTM only approximate?
The calculator uses a linear approximation. Exact YTM solves for the rate equating all future cash flows to the price, which requires iteration.
Q: What if the bond is callable?
An issuer may redeem early, so the yield-to-call can be more relevant than YTM when rates fall.