Yield-to-Maturity (YTM) Calculator
Calculate the total annualized return of a bond held to maturity. Factors in coupon payments, purchase price, face value, and time remaining to maturity.
Results
Enter values and click Calculate to see results
How to Calculate Yield to Maturity
Enter Bond Details
Input the bond's face value, coupon rate, and current market price.
Add Years to Maturity
Enter the number of years remaining until the bond matures.
Get YTM & Current Yield
See yield to maturity, current yield, and whether bond trades at premium or discount.
Why Use This YTM Calculator
Total Return Calculation
YTM includes both coupon income and capital gains/losses for complete return picture.
Premium/Discount Indicator
Automatically shows if bond trades above or below par value and what it means.
Current Yield Comparison
Compare current yield to YTM to understand the impact of price vs. par difference.
Investment Decision Support
Compare YTM across bonds to make informed fixed-income investment choices.
Bond Pricing Scenarios
| Price vs. Par | Relationship | YTM vs. Coupon | Investor Impact |
|---|---|---|---|
| Discount (Price < Par) | Buying below face value | YTM > Coupon Rate | Capital gain at maturity |
| At Par (Price = Par) | Buying at face value | YTM = Coupon Rate | No capital gain/loss |
| Premium (Price > Par) | Buying above face value | YTM < Coupon Rate | Capital loss at maturity |
Frequently Asked Questions
What is yield to maturity (YTM)?
YTM is the total annualized return you'll earn if you hold a bond until it matures. It includes all coupon payments plus any capital gain or loss from the difference between purchase price and face value.
How is YTM different from current yield?
Current yield only considers annual coupon income divided by price. YTM also factors in the capital gain/loss when the bond matures at face value, giving a more complete return picture.
Why would I buy a bond at a premium?
Premium bonds typically have higher coupon rates than current market rates. You pay more upfront but receive larger coupon payments. The YTM reflects the true return after accounting for the premium.
What affects a bond's YTM?
YTM changes with bond price (inverse relationship), time to maturity, coupon rate, and prevailing interest rates. When market rates rise, bond prices fall and YTM increases.
Is YTM guaranteed if I hold to maturity?
YTM assumes you hold the bond to maturity, receive all coupon payments, and the issuer doesn't default. It also assumes coupons are reinvested at the same YTM rate, which may not happen in reality.