Bond Price Calculator
Value a bond from its coupon, face value and the market yield — the fair price is the present value of every coupon plus par.
How it works
Price = coupon × [1 − (1 + r)^−n] ÷ r + face ÷ (1 + r)^n, where r = market yield ÷ coupons per year and n = periods
A bond is worth the present value of everything it pays: the stream of coupons plus the face value returned at maturity, each discounted at the market yield. When the market yield rises above the coupon rate the price falls below par (a discount); when it falls below the coupon the price rises above par (a premium). This inverse relationship between yields and prices is the core mechanic of the bond market.
Worked example
A $1,000 bond paying a 5% coupon semi-annually ($25 twice a year) for 10 years, discounted at a 6% market yield, is worth about $926 — a discount to par, because its 5% coupon is below what the market now demands.
Sources: Bond valuation — Wikipedia
Frequently asked questions
Why does the price fall when yields rise?
A bond’s coupons are fixed. If new bonds offer a higher yield, the old lower-coupon bond is only attractive at a lower price — one that raises its effective yield to match the market. Higher market yields therefore mean lower prices, and vice versa.
What is a premium versus a discount bond?
A premium bond trades above par because its coupon exceeds the market yield; a discount bond trades below par because its coupon is lower. At maturity both are redeemed at par, so a premium erodes and a discount accretes over time.
Does this price include accrued interest?
No. This is the clean price on a coupon date. Between coupon dates a buyer also pays accrued interest (the dirty price), which this tool does not add.
Related calculators
Educational estimate, not investment advice. Returns are hypothetical and not guaranteed.