Calculate Yield to Maturity for Zero Coupon Bonds
Introduction & Importance
The Yield to Maturity (YTM) for zero coupon bonds is a crucial metric for investors, as it helps determine the return on investment. This calculator simplifies the process of calculating YTM for zero coupon bonds.
How to Use This Calculator
- Enter the face value, maturity value, and years to maturity.
- Click ‘Calculate’.
- View your results and chart below.
Formula & Methodology
The formula for YTM of a zero coupon bond is:
YTM = (Maturity Value / Face Value)^(1/n) – 1
where n is the number of years to maturity.
For more information, see U.S. Treasury Yield Curve and Investopedia’s Bond Yield.