How Much Does a Bond Fear Rates?

When yields rise, bond prices fall — but by how much? That is the question modified duration answers. This modified duration calculator prices a bond from its cash flows, computes the Macaulay duration, and converts it into the sensitivity measure portfolio managers quote.

From Cash Flows to Duration

Discount every coupon and the final principal at the yield to maturity to get the price. Macaulay duration weights each cash-flow time by its present-value share — the average "wait" of your money. Dividing by (1 + yield per period) gives modified duration in years.

Reading the Risk

Modified duration 4.44 means each 100 bp yield move shifts the price about 4.4%. The calculator shows the estimated dollar change for ±100 bp. Long maturities and low coupons mean higher duration — and higher stakes when the Fed moves.