# Bond Yield Calculator

###### Updated: May 28, 2018

Bond Yield Calculator is used to calculate the ratio of the annual interest payment and the bond's current clean price

Current Bond Yield:
..
Background Information

What does Bond Yield mean?
Bond yield is the amount of return an investor realizes on a particular bond. The current yield equals annual earnings of the bond divided by its clean market price.
Importance of Bond Yield
Bond yields are also a measure of the profit made from your bond investment. This is the reason bond yields are a sound indicator of ‘how strong the stock market is and the interest amount in US Dollar’.
Formula
Current Bond Yield = Annual Interest Payment / Clean Price
Example
If you bought a bond having a face value of $100 that is selling at$90 and a coupon rate of 5%, the calculation would look like this:
1. Annual Interest Payment = 100 × 5% = 5
2. Current Bond Yield = Annual Interest Payment / Bond's Current Clean Price = 5 / 90 = 5.5%

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