Yield To Maturity Calculator

Enter the annual interest payment, face value, current price, and years to maturity of a bond. The calculator will evaluate and display the yield to maturity.

Yield to Maturity Formula

The following formula is used to calculate the yield to maturity of a bond or investment.

YTM = [ (AIP) + ( (FV – CP) / (Y) ) ]/ [( FV + CP ) / 2 ]

  • Where YTM is the yield to maturity
  • AIP is the annual interest payment
  • FV is the face value
  • CP is the current price
  • Y is the years to maturity

Yield To Maturity Definition

Yield to maturity is the total monetary value a bond needs to reach in order for it to mature.

Yield To Maturity Example

How to calculate a yield to maturity?

  1. First, determine the annual interest payment.

    Calculate the total annual interest payment.

  2. Next, determine the face value.

    Calculate the face value of the bond.

  3. Next, determine the current price.

    Calculate the current price of the bond on the market.

  4. Next, determine the years to maturity.

    Measure the number of years remaining until maturity.

  5. Finally, calculate the yield to maturity.

    Calculate the yield to maturity using the formula above.

FAQ

What is yield to maturity?

A yield to maturity is a total value a bond must achieve in order to reach maturity.

yield to maturity calculator
yield to maturity formula