Calculator Inputs
Use 0.5-year steps for maturity and holding period to match semiannual cash flow timing.
Example Data Table
This example uses the default values shown in the calculator above.
| Face Value | Coupon Rate | Purchase Price | Years to Maturity | Semiannual Yield | Effective Annual Yield | Annualized Realized Return |
|---|---|---|---|---|---|---|
| $1,000.00 | 6.00% | $950.00 | 10.0 | 3.31% | 6.73% | 6.61% |
Formula Used
Coupon per period = Face Value × Annual Coupon Rate ÷ 2
Net Cost = Purchase Price + Fees
Net Cost = Σ [Coupon ÷ (1 + r)^t] + [Redemption Value ÷ (1 + r)^n]Here,
r is the semiannual yield and n is the number of semiannual periods.
Bond Equivalent Yield = 2 × rEffective Annual Yield = (1 + r)^2 − 1
Current Yield = Annual Coupon Income ÷ Net Cost
Sale Price = Present value of remaining coupons and redemption value at the assumed market yield at sale
Coupon FV = Σ [Coupon × (1 + reinvestment rate per period)^(remaining holding periods)]
Annualized Return = (Realized Value ÷ Net Cost)^(1 ÷ Holding Years) − 1
After-tax figures in this calculator adjust coupon income for the coupon tax rate. They do not apply capital gains tax or jurisdiction-specific bond rules.
How to Use This Calculator
- Enter the bond face value, coupon rate, and purchase price.
- Add the redemption value, maturity, and any fees.
- Set coupon tax rate if you want after-tax income estimates.
- Enter your expected reinvestment rate for coupons.
- Choose a holding period in 0.5-year increments.
- Enter the market yield you expect when you sell the bond.
- Click the calculate button to show results above the form.
- Review yield, realized return, duration, DV01, and price sensitivity.
- Use the CSV or PDF buttons to export the result table.
Frequently Asked Questions
1) What is semiannual yield?
Semiannual yield is the return earned every six months from a bond’s price, coupon payments, and redemption value. Many bonds pay twice yearly, so this measure fits their cash flow pattern directly.
2) Why is bond equivalent yield different from effective annual yield?
Bond equivalent yield doubles the six-month yield. Effective annual yield compounds it. Effective annual yield is usually slightly higher because it reflects the extra return created by compounding.
3) What does current yield tell me?
Current yield compares annual coupon income with the bond’s net purchase cost. It is useful for income screening, but it ignores maturity value, reinvestment, and price changes during the holding period.
4) Why include fees in the calculation?
Fees increase your actual cost basis. A higher cost lowers yield, current income efficiency, and realized return. Including fees makes the output closer to what an investor really experiences.
5) What is the purpose of the assumed sale yield?
It estimates the market rate when you exit the bond before maturity. That assumption changes the expected sale price, which directly affects capital gain or loss and annualized realized return.
6) Why does the chart slope downward?
Bond prices and yields usually move in opposite directions. When market yield rises, discounting becomes stronger, so the present value of future cash flows drops and bond price falls.
7) What does DV01 mean here?
DV01 estimates how much the bond price may change for a 0.01% move in yield. It helps measure interest-rate sensitivity and compare risk across bonds with different maturities and coupons.
8) Are after-tax results fully comprehensive?
No. The calculator reduces coupon income by the coupon tax rate only. Real tax treatment may also include capital gains, exemptions, local rules, and account-specific considerations.