India, June 11 -- justify;">You can buy a bond either from the issuer when it is issued for the first time at face value or from the secondary market after issuance at the market price. The return you will earn from the bond will depend on when you bought it and at what price. In this article, we will learn how to use the coupon rate and bond yield to calculate bond returns.

When an issuer comes out with a bond issue, they promise to pay a specified interest rate that they will pay at specified intervals (usually annually) throughout the bond's tenure. The promised specified interest rate is known as the coupon rate. It is calculated on the bond face value. The coupon rate remains constant throughout the bond tenure, even if the bond pri...