Estimates only — not financial, tax, or professional advice.
100% private — every number you enter is calculated in your browser and never sent to our servers.
What it calculates: Bond Price, Premium/Discount to Par, Total Coupons to Maturity, Coupon per Payment.
Updated 5 June 2026 · Transparent assumptions
The coupon cannot change, so the price has to
A $1,000 bond paying 6% semi-annually gives $30 twice a year for ten years and $1,000 at the end. If buyers can get 7% elsewhere, nobody pays $1,000 for 6%. The price falls until the fixed payments deliver 7% on the money actually spent — $928.94, a discount of $71.06.
This is the whole mechanism behind bond price movement. Everything about the bond is fixed except its price, so the price absorbs every change in market yields. When yields rise, existing bonds fall; when yields fall, they rise. Nothing about the issuer changed.
The present value of every payment, discounted at the market yield
The price is computed by discounting each of the twenty coupon payments and the final $1,000 back to today at 3.5% per half-year, then adding them. Payments further out are discounted harder, which is why a long bond’s price is so much more sensitive to yields than a short one’s.
The frequency field matters more than it looks. A bond paying semi-annually discounts at half the annual yield over twice as many periods, which is not the same as annual discounting and produces a different price. Getting the frequency wrong is one of the more common errors in hand-priced bonds.
The price is a direct statement about the coupon versus the market
Set the yield equal to the coupon rate and the price returns exactly $1,000 — the bond is worth its face value because it pays precisely what the market demands. Above that, the bond trades at a discount; below it, at a premium.
That relationship makes the price a readable signal. A bond trading at 92 is telling you its coupon is below current market rates, and by roughly how much. A bond at 110 is telling you the opposite — and that the premium will erode to zero by maturity, which is why a high-coupon premium bond does not yield what its coupon suggests.
Accrued interest, credit risk and any call provision
This is the clean price. Buying between coupon dates also requires paying the seller the interest accrued since the last payment — the dirty price — which can be up to a full coupon more than the figure shown.
The model also assumes the issuer pays. A yield that looks unusually attractive is usually compensating for credit risk rather than offering free return, and a callable bond can be redeemed early, typically when rates have fallen and you would least want the money back.
Sources & References
Figures on this page are checked against primary, authoritative sources. Links open in a new tab.
Bond YieldYield to maturity, current yield, and annual coupon income from price, face value, and coupon rate.
Coupon PaymentThe cash each coupon pays and the annual total, from face value, coupon rate and payment frequency.
InvestmentProject lump-sum and regular-contribution growth, plan a goal, and solve future vs present value, with fees and inflation.
Regular InvestmentProject how regular monthly contributions grow over time — SIP-style investing, dollar-cost averaging, inflation-adjusted value, and long-term goals.
Returns are assumptions, not guarantees. Actual results may vary because of market performance, taxes, fees, inflation, and timing. This is an educational projection, not investment advice.
Published the calculator with its formula, worked example, assumptions, limitations and a bespoke guide, and added an automated formula test suite covering it.
Tested the discounted-cash-flow price against hand-computed present values, including the par case where a coupon equal to the yield must price at exactly face value.
Tested that raising the required yield above the coupon always produces a discount and lowering it always produces a premium.
Add this calculator to your site
Responsive embed — and private: nothing your visitors type leaves their browser.