Face value/ Par value. To calculate the price for a given yield to maturity see the Bond Price Calculator. None (Zero Coupon). What is the Yield to Maturity? . You can use this Bond Yield to Maturity Calculator to calculate the bond yield to maturity based on the current bond price, the face value of the bond, the number of years to maturity, and the coupon rate. This yield to maturity calculator assumes that the bond is not called prior to maturity. Raise 2 to the 1/30th power and you get 1.02329. The YTM is based on the belief or understanding that an investor purchases the security at the current market price and holds it until the security has matured This calculator shows the current yield and yield to maturity on a bond; with links to articles for more information. In finance theory, the YTM represents the rate of return forecasted on a bond if held until its maturity. This information will help an investor to calculate yield to maturity easily. The annual coupon rate is 8% with a maturity of 12 years. Importantly, it assumes all payments and coupons are on time (no defaults). Enter the value your paid for the T-Bill; The Treasury Bill Calculator will then automatically calculate: The profit or yield of the T-Bill; The flat percentage profit based on the T-Bill purchase price and T-Bill maturity price Coupon on the bondwill be $1,000 * 8% which is $80. The calculator uses the following formula to calculate the current yield of a bond: CY = C / P * 100, or CY = (B * CR / 100) / P. B is the par value or face value of a bond. Subtract 1, and you have 0.02329, which is 2.3239%. Homeowners Insurance: Protect Your Investment, Travel Insurance: Protection from Your Worst Trip Nightmares, How to Pick the Best Life Insurance Policy. 4. Finish up by choosing a compounding interval from the pull-down menu. YTM = (M/P)1/n- 1 variable definitions: 1. Yield-to-Maturity Approach. To calculate the approximate yield to maturity, you need to know the coupon payment, the face value of the bond, the price paid for the bond and the number of years to maturity. Here are the details of the bond: 1. United States Salary Tax Calculator 2020/21, United States (US) Tax Brackets Calculator, Statistics Calculator and Graph Generator, UK Employer National Insurance Calculator, DSCR (Debt Service Coverage Ratio) Calculator, Arithmetic & Geometric Sequences Calculator, Volume of a Rectanglular Prism Calculator, Geometric Average Return (GAR) Calculator, Scientific Notation Calculator & Converter, Probability and Odds Conversion Calculator, Estimated Time of Arrival (ETA) Calculator. Amortization Schedule Calculator: Find My Mortgage Repayment Schedule, Simple Savings Calculator: See How You Can Grow Your Money. Compound Annual Growth Rate (CAGR) Calculator. In this case, the interest rate is the semi-annual rate and can be multiplied by two for an annual rate of 7.01%. Is This The Ultimate Value Investing Model? A yield to maturity formula is shown at the bottom on how to calculate yield to maturity. for use in every day domestic and commercial use! Quarterly Subtract the asking price of the T-bill from its par value, the dollar amount that the T-bill will be redeemable for at maturity. YTM Calculator (Click Here or Scroll Down) The yield to maturity formula is used to calculate the yield on a bond based on its current price on the market. Par Value of Bond (Face Value, fv): $1000 2. It is the amount that is payed to the holder of the bond on the date that it matures, also called the redemption date. Yield to Maturity (YTM) Calculator Our yield to maturity financial calculator measures the annual return an investor would receive if a particular bond was bought today and held until maturity. The current yield is a measure of the income provided by the bond as a percentage of the current price:There is no built-in function to calculate the current yield, so you must use this formula. Years to Maturity: 5 years. Yield to Maturity Calculatoris an online tool for investment calculation, programmed to calculate the expected investment return of a bond. For example, you buy a bond with a $1,000 face value and 8% coupon for $900. For the example bond, the current yield is 8.32%:Note that the current yield only takes into account the expected interest payments. Solution: The yearly coupon payment is $1000 × 6% = $60, the equation takes the following form: 980 = 60×(1 + r) -1 + 60×(1 + r) -2 + 60×(1 + r) -3 + 60×(1 + r) -4 + 60×(1 + r) -5 + 1000×(1 + r) -5, r = 6.48%, The Yield to Maturity (YTM) is 6.48%, You may also be interested in our free Tax-Equivalent Yield Calculator, A collection of really good online calculators. 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