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July 25, 2014

July 25, 2014

Posted by **Kevin** on Friday, March 5, 2010 at 4:47pm.

- Finance -
**drwls**, Saturday, March 6, 2010 at 8:47amWhat you probably really want is the Yield To Maturity (YTM). Assume the bond returns a $1000 face value after 4 years. That is what face value means. The coupon rate is the annual fraction of THAT value paid out.

With annual interest payments, the YTM is 14.7%. Most bonds make an interest payment semiannually. That won't change the YTM much.

There are online Java tools and formulas for computing YTM.

See, for example,

http://www.investopedia.com/calculator/AOYTM.aspx?viewed=1

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