Bond Calculator | Calculate Yield, Duration, and Values
Calculate bond yields, duration, and values with our comprehensive bond calculator. Analyze fixed-income investments for better financial decision-making.
Category: Financial
Bond Calculator
Frequently Asked Questions
What is yield to maturity (YTM)?
Yield to maturity (YTM) is the total return anticipated on a bond if held until it matures. It considers the bond's current market price, par value, coupon interest rate, and time to maturity, and assumes that all coupon payments are reinvested at the same rate.
What is bond duration?
Bond duration measures a bond's sensitivity to interest rate changes. It represents the weighted average time until cash flows are received, and also approximates the percentage change in a bond's price for each 1% change in interest rates.
Why would a bond trade at a discount or premium?
Bonds trade at a discount (below par value) when market interest rates are higher than the bond's coupon rate. Conversely, bonds trade at a premium (above par value) when market rates are lower than the bond's coupon rate.
How does payment frequency affect bond values?
More frequent payments (monthly vs. quarterly vs. semi-annually) generally result in higher bond values and lower yields, all else being equal. This is because investors receive their cash flows earlier and can reinvest them sooner.