Bond Yield Calculator
Calculate current yield and yield to maturity for bonds. Compare bond returns. Free calculator.
Current Yield vs Yield to Maturity
Current yield = annual coupon / market price. Simple but ignores capital gain or loss at maturity. Yield to maturity (YTM) accounts for the difference between purchase price and face value. A bond bought at $980 with 4.5% coupon maturing in 10 years has a YTM slightly above 4.5% because you gain $20 at maturity.
Bond Pricing Basics
Bond prices move inversely to interest rates. When rates rise, existing bond prices fall (their lower coupons are less attractive). When rates fall, bond prices rise. A 1% rate increase causes roughly a 7-10% price decline for a 10-year bond. This is why long-term bonds are riskier than short-term bonds in rising rate environments.
The 10-year Treasury yield is the most important number in finance — it drives mortgage rates, corporate borrowing, and stock valuations. When the 10-year rises, virtually all other rates follow.
