Bond Yield to Maturity Calculator
Solve for a bond’s yield to maturity from its price, coupon and time to maturity — the true return if you hold it to the end.
How it works
Price = Σ coupon ÷ (1 + y)^t + face ÷ (1 + y)^n, solved for the per-period yield y · YTM = y × coupons per year
Yield to maturity is the single discount rate that makes the present value of a bond’s coupons plus its face value equal to its current price. There is no closed-form solution, so it is found numerically — this tool solves it by bisection. When a bond trades below par its YTM is above the coupon rate (you also gain the pull to par), and when it trades above par the YTM is below the coupon.
Worked example
A $1,000 bond with a 5% coupon paid semi-annually, priced at $950 with 10 years left, pays $25 twice a year plus $1,000 at maturity. The yield that discounts those cash flows back to $950 is roughly 5.7% — above the 5% coupon because you bought at a discount.
Sources: Yield to maturity — Wikipedia
Frequently asked questions
How is YTM different from the coupon rate?
The coupon rate is fixed interest on the face value. YTM is your actual annualized return if you buy at the current price and hold to maturity, reinvesting coupons at that same rate — it captures the discount or premium to par as well as the coupons.
What is the difference between YTM and current yield?
Current yield is just the annual coupon divided by the price and ignores the gain or loss from the price returning to par at maturity. YTM includes that, so the two only match when the bond trades exactly at par.
Does YTM assume I reinvest coupons?
Yes. YTM assumes every coupon is reinvested at the YTM itself. If you actually reinvest at a lower rate, your realized return will be below the stated YTM — this is called reinvestment risk.
Related calculators
Educational estimate, not investment advice. Returns are hypothetical and not guaranteed.