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Bond Calculator

Give a bond's face value, coupon, yield to maturity and years left, and get its price — premium, par or discount — plus the current yield. The price-yield seesaw, computed.

The bond

Price and yield: the seesaw that runs the bond market

A bond's coupon is carved in stone; its price is not. When market yields rise above the coupon, the bond must cheapen until its yield matches the market; when yields fall, the bond earns a premium. This calculator turns a yield into the price that produces it — the mechanism behind every 'bonds fell today' headline.

Price = coupon × (1 − (1 + y)−n) ÷ y + face × (1 + y)−n, per period
Example: a $1,000 bond, 5% coupon paid semiannually, 10 years to maturity. At a 4.5% yield it prices near $1,039.60 (a premium — its coupon beats the market). At a 6% yield it falls to about $925.60. One bond, two prices, nothing changed but the market's mood.

Current yield is not yield to maturity

Current yield (annual coupon ÷ price) ignores the pull back to face value at maturity. Yield to maturity counts everything — coupons, and the certain gain or loss as price converges to face. The result panel shows both; only the second is the bond's actual promised return if held to the end.

How this is calculated

Price = present value of all coupon payments plus the face value, discounted at the yield per period (yield ÷ coupons per year). Clean price only — accrued interest between coupon dates is a settlement addition the page excludes and says so by omission from 'price'. Callable bonds can be redeemed before the maturity modeled here; yield-to-call is a different, lower number on premium bonds.

Frequently asked questions

Why do bond prices fall when rates rise?

A new bond at the higher rate is simply more attractive, so the old bond's price must fall until its total return competes. The relationship is mechanical — the formula on this page is the mechanism.

What is duration, then?

Duration measures how violently the price moves per point of yield change — longer maturity and lower coupons mean bigger swings. This page computes the price at one yield; try the yield ±1% to feel the duration of your specific bond.

Are bond coupons taxed like dividends?

Interest is generally taxed as ordinary income (with exceptions — US Treasuries are state-tax-exempt; municipal bonds often federally exempt). The yield comparisons that matter are after-tax, which is investor-specific and outside this page.

What does 'at par' mean?

Price exactly equal to face value — which happens when the yield equals the coupon rate. It is the seesaw's balance point, visible if you enter the coupon as the yield.

Not financial advice. This calculator is for information and education only. Results are estimates worked out from the figures you enter and the conventions described on this page; they are not financial advice, a loan offer, a quote, or a guarantee of any return. Products, rates and rules change, and your own circumstances matter — for decisions about your money, speak to a qualified, regulated professional.

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