What is a bond’s price?
A bond’s price is the present value of all the cash flows it will pay an investor: its periodic coupon payments plus its face value (par) at maturity, discounted at the market’s required yield to maturity (YTM).
How this calculator works
The price is calculated as Price = Σ [Coupon ÷ (1 + y)t] + [Face Value ÷ (1 + y)n], summed over each coupon period, where y is the periodic yield (YTM ÷ payments per year) and n is the total number of periods.
- When the coupon rate is above the YTM, the bond trades at a premium (price above face value).
- When the coupon rate is below the YTM, the bond trades at a discount (price below face value).
- When the coupon rate equals the YTM, the bond trades at par (price equals face value).
This calculator is for general educational and planning purposes only and is not investment advice.
Last reviewed August 2026