Bond Cheat Sheet

Bookmark this page. Use it as your hub while you look at a broker quote or Treasury auction result: pick the question you have, jump to the formula, then run the numbers in the calculator.

Open beside your broker

Need current yield, coupon cash, or a rough rate-shock estimate? Use the Bond Yield & Income Calculator — then come back here for the definition of the term you forgot.

Quick definitions

Term	In plain English
Face / par / principal	Amount the issuer typically repays at maturity (often $1,000 for corporates).
Coupon rate	Fixed annual interest as a % of face (e.g. 5% on $1,000 → $50/year).
Market price	What you pay today — may be above (premium) or below (discount) face.
Current yield	Annual coupon ÷ market price. Simple, but not full YTM.
YTM	Yield to maturity — total expected return if held to maturity (includes pull-to-par).
Duration	Sensitivity of price to yield changes. Higher ≈ more bounce when rates move.
Callable	Issuer may redeem early — often when rates fall.
Spread	Extra yield over a benchmark (often Treasuries) for credit / liquidity risk.

Core formulas

Confirm with the calculator. These are the beginner versions — not a full pricing model.

Question	Formula	Example
Annual coupon $	Face × coupon%	$1,000 × 5% = $50
Current yield	Annual coupon ÷ price	$50 ÷ $980 ≈ 5.10%
Semi-annual payment	Annual coupon ÷ 2	$50 ÷ 2 = $25
Premium / discount	Price − face	$1,020 − $1,000 = $20 premium
Approx. % price change	−duration × Δyield	Duration 7, +1% yields ≈ −7% price

In plain English

Coupon is the cash schedule. Yield is what that cash is worth relative to the price you pay. Duration is how hard the price swings when yields move.

Good fit if

You are looking at a real quote and need a one-screen reminder before you click buy.

Beginner mistake

Treating current yield as if it were YTM — or assuming a bond fund “matures” like a single bond.

Which tool should I open?

Your situation	Start with	Then use
I see a coupon and a price — what yield is that?	Bond Basics	Calculator → Current Yield
How much cash interest will I get?	This cheat sheet (Coupon $)	Calculator → Coupon Income
Is this bond above or below par?	Definitions above	Calculator → Premium / Discount
Rates might rise — how much could price fall?	Things You Should Know	Calculator → Rate Shock
I am still deciding whether to buy at all	When NOT to Buy Bonds	Start Here

Headline → what it usually means for bonds

Headline vibe	Often happens to high-quality bond prices
Hot inflation / “Fed may hike”	Yields up → prices often down
Growth scare / “Fed may cut” (inflation cooling)	High-quality prices often up
Risk-on boom	Safe-haven demand may fade (yields up)
Credit stress	Treasuries may rally; junk spreads widen

Tendencies, not rules. Markets price expectations — a “good” jobs number can hurt bonds if it reduces odds of rate cuts. More context: Things You Should Know.

Risk checklist (before you buy)

Interest-rate risk — prices fall when yields rise (especially longer duration).
Credit risk — issuer may miss payments (corporates / some munis).
Inflation risk — fixed coupons buy less if prices rise.
Call risk — high coupons may be taken away early when rates fall.
Liquidity risk — some bonds are hard to sell near a fair price.
Fund vs bond — bond funds do not repay a fixed face on a fixed date.