HTTP vs HTTPS The significance of S: Http or the hypertext transfer protocol is something we use when we access the internet. Though we seldom notice it if at all, it plays a very essential role.
This is because the interest rate risk (risk of missing out on higher interest rates) decreases the closer bonds get to their maturity dates. With that, let's use the Bond Value Calculator to calculate the price of a bond given its face value, coupon rate, market rate, and years-to-maturity. Next enter the current market rate and the number of years to maturity, then click the Calculate Bond Valuation button.
1 Time to maturity: Consider two bonds that each cost $1,000 and yield 5%. 2  A bond that matures in one year would more quickly repay its true cost than a bond that matures in 10 years. 3  As a result, the shorter-maturity bond would have a lower duration and less price risk. 4  The longer the maturity, the higher the duration. The longer the maturity, the higher the duration. 2  Coupon rate: A bond's payment is a key factor in calculating duration. 3  If two otherwise identical bonds pay different coupons, the bond with the higher coupon will pay back its original cost quicker than the lower-yielding bond.