Bond Current Yield Calculator

This bond current yield calculator works out the cash return a bond pays you right now, as a percentage of the price you pay for it. Current yield is one of the simplest bond measures: it takes the annual coupon income, the fixed dollar interest the bond pays each year, and divides it by the bond's current market price. Enter the face value, which sets the coupon in dollars, the coupon rate as a percentage, and the price you would pay in the market, and the calculator returns the annual coupon in dollars and the current yield as a percentage. The key insight is that the coupon is fixed against face value, so the price you pay changes the yield: buy a bond below its face value and the same coupon becomes a bigger slice of your smaller outlay, pushing the current yield above the coupon rate, while paying above face value drags it below. That is why current yield is a quick way to compare bonds trading at different prices. It is not the whole story, though: current yield ignores the gain or loss you make when the bond is repaid at face value on maturity, and it ignores the timing of payments. For the full picture of return, use yield to maturity, which folds in that capital gain or loss and the payment schedule. Treat current yield as a fast, useful snapshot of income against price.

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A $1,000 bond paying a 5% coupon returns $50 a year. Bought at $950, that is a current yield of 5.26%, above the coupon rate because you paid below face value.

Current yield counts coupon income only, not the gain or loss at maturity. For total return use yield to maturity. Not financial advice.