Yield to Maturity Calculator

Yield to Maturity Definition

Yield to Maturity is the annualized rate of return received by an investor purchasing a bond today and holding it until it matures, comprising of both capital gains and interest.

Variables

Interest Payment=The dollar amount of each interest payment
Future Value=The redemption value of the bond certificate
Present Value=The current market value of the bond
N=Number of interest payments until maturity

Yield To Maturity Formula

The Yield to Maturity is solved by iteration. The yield is estimated, and then adjusted as needed to zero in on the exact yield to maturity.