🔖 Yield to Maturity Calculator
Enter a bond’s current price, face value, coupon rate, and years to maturity to estimate its yield to maturity (YTM).
What is yield to maturity?
Yield to maturity (YTM) is the total annualized return an investor can expect if they buy a bond at its current price and hold it until maturity, receiving all coupon payments and the face value at the end. It accounts for the bond’s price, coupon, face value, and time remaining.
How this calculator works
This calculator shows two figures. The approximate YTM uses a widely taught shortcut formula: YTM ≈ [Coupon + (Face Value – Price) ÷ Years] ÷ [(Face Value + Price) ÷ 2]. The exact YTM is solved numerically (using bisection) by finding the discount rate that makes the present value of all future coupons and the face value equal to the bond’s current price — the same approach bond traders and financial calculators use.
- When a bond trades below face value (a discount), YTM is higher than the coupon rate.
- When a bond trades above face value (a premium), YTM is lower than the coupon rate.
- This calculator assumes annual coupon payments for simplicity.
This calculator is for general educational and planning purposes only and is not investment advice.