Current yield is a bond's annual coupon income divided by its market price. Enter the face value, coupon rate and price to get it instantly, see how it compares with the coupon rate and an exact yield to maturity, or find the price that gives a target current yield.
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Optional: compare with yield to maturity
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How to use the Current Yield Calculator
Enter the face value and annual coupon rate of the bond.
Enter the market price, either as an amount or as a quote per 100 of face value.
Optionally add years to maturity and the coupon frequency to compare with yield to maturity.
Read the current yield, the coupon income and whether the bond trades at a premium or discount.
Use the price table to see how the yield changes if the price moves, or switch to solve for the price.
Current yield formula and example
Current yield = annual coupon ÷ market price, where annual coupon = face value × coupon rate.
Example: a 1,000 face bond with a 5% coupon pays 50 a year. At a price of 950 the current yield is 50 ÷ 950 = 5.263%.
With 8 years left and semi-annual coupons, its yield to maturity is about 5.79%, because the buyer also gains 50 when the bond repays 1,000 at maturity.
Current yield of a 5% coupon bond at different prices
Price (per 100)
Annual coupon (per 1,000)
Current yield
Trades at
85
50
5.882%
Discount
90
50
5.556%
Discount
95
50
5.263%
Discount
100
50
5.000%
Par
105
50
4.762%
Premium
110
50
4.545%
Premium
Coupon rate, current yield and YTM: the ordering rule
Discount bond (price below par): coupon rate < current yield < yield to maturity.
Par bond: coupon rate = current yield = yield to maturity.
Premium bond (price above par): coupon rate > current yield > yield to maturity.
The gap between current yield and YTM is largest for bonds far from par with few years left, because the gain or loss at maturity is spread over fewer years. For long bonds near par, current yield is a reasonable shortcut.
Frequently asked questions
What is the current yield formula?
Current yield = annual coupon payment ÷ current market price × 100. A bond with a 1,000 face value and a 5% coupon pays 50 a year; if it trades at 950, its current yield is 50 ÷ 950 = 5.263%.
What is the difference between current yield and yield to maturity?
Current yield only looks at this year's coupon income relative to the price. Yield to maturity also counts the gain or loss between the price you pay and the face value you get back at maturity, and the timing of every cash flow. For a discount bond YTM is higher than current yield; for a premium bond it is lower.
How does current yield compare with the coupon rate?
The coupon rate is fixed and based on face value. Current yield is based on the market price. When the price is below par, current yield is above the coupon rate; above par, it is below; at par they are equal.
Should I use the clean or dirty price?
Use the clean price, the quoted price without accrued interest. Accrued interest is a temporary amount that you get back with the next coupon, so including it would understate the yield slightly between coupon dates.
Is current yield a good measure of return?
It is a quick measure of income, useful for comparing how much cash a bond pays relative to its cost, but it is not a full return measure. It ignores the pull to par at maturity, reinvestment of coupons and call features. Use yield to maturity or yield to call for total return comparisons.
What is the current yield of a zero-coupon bond?
Zero. A zero-coupon bond pays no coupons, so all of its return comes from the difference between the price and the face value. Use yield to maturity or a zero-coupon bond calculator instead.
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