Bond price calculator
A bond is a stream of coupons plus a face value at maturity. Price is the present value of both at the market yield.
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Bond price
925.6126
- Present value of the coupons
- 371.94
- Present value of the face amount
- 553.68
- Premium over face value
- -74.39
- Current yield
- 5.4018 %
Show the working
- Face value = 1000
- Annual coupon rate = 5
- Market yield = 6
- Years to maturity = 10
- Coupons per year = 2
- c = 1000 * 5 / 100 / 2 = 25
- y = 6 / 100 / 2 = 0.03
- n = 10 * 2 = 20
- discount = (1 + 0.03)^20 = 1.806 11
- Present value of the coupons = 25 * (1 - 1/1.806 11) / 0.03 = 371.937
- Present value of the face amount = 1000 / 1.806 11 = 553.676
- Bond price = 371.937 + 553.676 = 925.613
- Premium over face value = 925.613 - 1000 = -74.3874
- Current yield = 925.613 > 0 ? 1000 * 5 / 100 / 925.613 * 100 : 0 = 5.401 83
Values are shown to six significant figures here; the arithmetic itself runs on exact fractions and is only rounded where a number is printed.
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The formula
- price = C (1 - (1+y)^-n) / y + F / (1+y)^n
- C is the coupon per period, y the yield per period, n the number of periods.
This is the clean price on a coupon date. Between dates you add accrued interest to get the dirty price.
The band labels assume a face value of 1000.
This is arithmetic, not financial advice. Real products carry fees, tax treatment and terms that no formula captures.