Clean Price
The quoted bond price excluding accrued interest.
Clean price is how bonds are quoted in most markets — it's the price stripped of accrued interest. This convention exists because a bond's full value oscillates between coupon payments (rising as interest accrues, then dropping when a coupon is paid). By quoting clean prices, you can compare bonds fairly without worrying about where each bond is in its coupon cycle. When you actually buy a bond, you pay the dirty price (clean price + accrued interest), but the clean price is what you see on your screen and what traders negotiate. Think of clean price as the bond's 'core value' before adding the interest that's built up since the last payment.
- Clean prices are quoted for comparability across bonds
- Dirty price is the actual amount paid at settlement
Dirty Price
The total settlement price paid for a bond, including accrued interest.
Accrued Interest
Interest that has accumulated since the last coupon payment, paid by the buyer to the seller.
Current Yield
Annual coupon income divided by the bond's clean price.
Running Yield
Annual coupon income divided by the bond's dirty price (clean price plus accrued interest).
Yield to Maturity (YTM)
The annualized return if you hold the bond to maturity, assuming all coupons are reinvested at the same rate.
Market Value
The current dollar value of a bond position, calculated as price times notional.