Bond Yield Calculator

Calculate current yield and yield to maturity (YTM) from bond price, coupon rate, and maturity.

By Konstantin Iakovlev · Updated September 2026 · Source: U.S. Treasury — Daily Treasury Par Yield Curve Rates (September 2026)

$
%
$
years

Current Yield

5.26%

Approx. YTM

5.64%

Bond Status

Discount

Below face value

Bond Analysis

Face Value$1,000.00
Purchase Price$950.00
Annual Coupon Payment$50.00
Current Yield5.26%
Approximate YTM5.64%
Total Coupon Income$500.00
Capital Gain / Loss at Maturity$50.00
Total Return$550.00

Current yield measures annual income relative to the purchase price. Yield to maturity (YTM) accounts for both coupon income and the gain or loss at maturity. The YTM shown is an approximation.

Use the Bond Yield Calculator above to calculate your results. Enter your values and see instant results — all calculations run in your browser.

Disclaimer: This calculator is for informational purposes only and does not constitute tax, financial, or legal advice. Results are estimates based on the information you provide and current rates. Always consult a qualified tax professional or financial advisor for advice specific to your situation.

How It Works

Two numbers tell you most of what a bond will return: its current yield and its yield to maturity (YTM). With them in hand, an investor can line up competing bonds and weigh fixed-income choices on common ground rather than guesswork.

Current yield is the simpler of the two: divide the annual coupon payment by the bond's current market price. YTM asks more of the math, capturing the full return you would earn by holding the bond to maturity while weighing its current market price, par value, coupon interest rate, and time to maturity all at once. The exact YTM has no closed-form solution and has to be found by trial and error, so the calculator uses the standard shortcut instead: YTM ≈ (annual coupon + (face value − price) / years) / ((face value + price) / 2). For a bond priced near face value the shortcut lands within a few hundredths of a point of the exact figure; for a deep-discount bond it can be off by a few tenths.

One assumption baked into YTM is that every coupon payment gets reinvested at the same yield, which real markets do not guarantee. Callable bonds add their own wrinkle, since the issuer can redeem them before maturity and change the yield you actually collect. Read any yield figure alongside the issuer's creditworthiness and the prevailing rate environment to know what it is really telling you.

Example: A Discount Corporate Bond With 2 Years Left

  1. 1 A corporate bond with a $1,000 face value and a 4.5% annual coupon has 2 years left to maturity and trades at $980. Enter $1,000, 4.5%, $980 and 2 years.
  2. 2 Annual coupon: $1,000 × 4.5% = $45. Current yield: $45 / $980 = 4.59%.
  3. 3 Approximate YTM: ($45 + ($1,000 − $980) / 2) / (($1,000 + $980) / 2) = $55 / $990 = 5.56%. Solving exactly with annual coupons gives about 5.58%, so the shortcut is close here.
  4. 4 YTM is above the current yield because the bond trades at a discount: held to maturity it pays $90 of coupons plus a $20 gain, a $110 total return on the $980 you paid. Whether 5.56% a year is enough depends on the issuer's credit and on what a Treasury of similar maturity pays.

Source: U.S. Treasury — Daily Treasury Par Yield Curve Rates (September 2026) · Last updated: September 2026

Frequently Asked Questions

What is the difference between current yield and yield to maturity?
Current yield is simply the annual coupon payment divided by the bond current price. Yield to maturity (YTM) also accounts for the gain or loss if you hold the bond until maturity, making it a more complete measure of return.
Why do bond prices go down when interest rates go up?
When new bonds offer higher rates, existing bonds with lower rates become less attractive, so their prices drop to compensate. If market yields rise by one percentage point, a 10-year bond bought at par with a 4-5% coupon loses about 7.4-7.8% of its price.
What is a good bond yield in 2026?
Start with a Treasury of similar maturity. On September 23, 2026, Treasury's daily par yield curve put the 3-month bill at 4.19%, the 2-year note at 4.85% and the 10-year note at 5.11%. A corporate bond should pay more than the matching Treasury to make up for its credit risk, and the lower the issuer's rating, the wider that gap should be.

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