Bond Price Calculator

How it is calculated

The price is the present value of all cash flows at the yield to maturity. With f payments a year, n = years × f, the coupon per period is C = face × coupon% ÷ f and the rate per period is i = YTM% ÷ f. Then price = C × (1 − (1 + i)−n) ÷ i + face ÷ (1 + i)n. If the yield is 0 the coupons are simply added. An empty coupon counts as 0 (a zero-coupon bond), and an empty or non-positive frequency counts as 2, semiannual. Besides the price, the tool shows the coupon per period, the current yield (annual coupon ÷ price) and whether the bond is at a discount, premium or par. It assumes a whole number of periods remain, so no accrued interest is included.

Common mistakes

• Confusing the yield shown in the result with the yield to maturity. It is the current yield, annual coupon divided by price, and ignores the gain or loss at maturity.
• Entering the coupon rate or the yield as a decimal. Both fields take percentages, so 5 means 5%.
• Leaving the payment frequency at its default for an annual bond. An empty frequency counts as 2, so a bond paying once a year needs 1 entered.
• Expecting the price to include accrued interest. The tool prices the bond as if a coupon was just paid, so a price quoted between coupon dates will differ.
• Mixing an annual yield with a monthly or quarterly coupon count. The yield is divided by the frequency you enter, so state both on the same annual basis.