Bond Valuation

The purpose of this calculator is to provide calculations and details for bond valuation problems. It is assumed that all bonds pay interest semi-annually. Future versions of this calculator will allow for different interest frequency.

Input
Maturity Years
Coupon Rate
%
Face Value
$
Maturity Yield
%
Bond Value
Solve for PV
Cash Flows (N)
Cash Flow (PMT)
$
6 Months Yield (i)
%
Future Value (FV)
$
Computational Details
Interest Value
$
Cash Flow
$
Annuity Factor
Present Face Value
$
Face Value
$
Discount Factor

Instructions

Fill in the fields that correspond to the number of years, maturity, coupon rate, and yield-to-maturity, followed by clicking on the Calculate button. The calculator will provide the rest. The coupon rate and yield-to-maturity can be entered as whole numbers or in decimals.

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Explanations

Calculator inputs

There are five variables in a bond valuation problem. Using a financial calculator requires that you type in the four known elements (N, PMT, I, and FV) and solve for the one unknown, the present value (PV).

Computational details

The value a bond today is the sum of the present value of the interest payments (valued as an ordinary annuity) and the present value of the face value (discounted as a lump-sum):

PV = [ S CFt/(1 + i)t] + [FV / (1 + i)t]

About

Bond Valuation

Version: 0.1

Author: Calculator team

Based on a demo from Netscape. Modified for bonds by Pamela Peterson.