Estimate price sensitivity from bond prices after small yield shifts.
Please do not make financial decisions based on these results.
What is the Effective Duration Calculator?
Estimate price sensitivity from bond prices after small yield shifts. To use the Effective Duration Calculator, enter price now, price if yields fall, price if yields rise, yield change; it returns effective duration, price change per 1% yield rise, and shows them instantly as you type.
Where the Effective Duration Calculator fits
Estimate price sensitivity from bond prices after small yield shifts. The main figure it returns is the Effective duration, worked out from the values you enter.
It belongs with the other bonds & credit ratios tools. If you are comparing options or checking a result from another angle, try the Bond Price Calculator, Bond YTM Calculator or the Bond Convexity Calculator.
How to use the Effective Duration Calculator
- Fill in the fields. You will need Price now ($), Price if yields fall ($), Price if yields rise ($), Yield change (%). Take the price, coupon and maturity from the bond’s listing. Fields marked optional can stay at zero.
- Read the result. The highlighted box gives the Effective duration, and the cards below show Price change per 1% yield rise. Tables and charts break it down further.
- Test other scenarios. Results update as you type. Change one value at a time to see what drives the answer, and press Reset to go back to the defaults.
Formula and how it works
Example with real numbers
Here is the Effective Duration Calculator using the default values shown in the calculator above:
Inputs
| Price now ($) | 985 |
|---|---|
| Price if yields fall ($) | 1,030 |
| Price if yields rise ($) | 942 |
| Yield change (%) | 1 |
Results
| Effective duration | 4.47 |
|---|---|
| Price change per 1% yield rise | -4.47% |
With these inputs the calculator returns Effective duration: 4.47. Change any value in the calculator to see how the result moves.
What if you change one input?
Sensitivity check: raising Price now ($) from 985 to 1,182 (about 20% higher) and leaving everything else as in the example above changes the results like this:
| Result | Example | After the change | Change |
|---|---|---|---|
| Effective duration | 4.47 | 3.72 | -16.7% |
| Price change per 1% yield rise | -4.47% | -3.72% | +16.7% |
The input that moves the result most is the one to check twice. Change it in the calculator above to test your own case.
What the results tell you
The results panel of the Effective Duration Calculator reports Effective duration and price change per 1% yield rise. Compare these figures while changing one input at a time, and use the related calculators below to look at the same situation from another angle.
Method and limits. This calculator applies the formula in the section above to your inputs, in your browser; nothing you enter is stored on our servers. The result is only as accurate as the numbers you enter and the formula shown above. It is for information, not financial, tax or legal advice.
Frequently asked questions
What does a duration of 6 mean?
A 1% rise in yields lowers the bond’s price by about 6%.
Why do bond prices fall when rates rise?
New bonds pay the higher rate, so older, lower-coupon bonds must sell at a discount to match the market yield.
What interest coverage is safe?
Above about 3 times is comfortable; below 1.5 times signals stress.
Are the results guaranteed?
No. Results depend entirely on the numbers you enter and the formulas shown on this page. Please do not make financial decisions based on them alone; confirm important figures with a licensed professional.
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