Yield to Maturity or Bond Yield

[Stuart Moscoe]

Has anyone created a custom function to find the Yield to Maturity of a bond?

There is a function in Excel named Yield(). It takes the following parameters:

Settlement Date

Maturity Date

Coupon Rate

Price per $100 of Face amount

Redemption per $100 of Face amount (this is usually 100)

Frequency of coupon payments per year (usually 2 payments per year)

Basis (Whether the year is calculated at 360 days, 365 days or actual number of days)

The function in Excel uses trial and error to find the Yield. It calculates to the 9th decimal place. The function has to use trial and error as this is the only way to do it. I have taken finance courses, and that is how it is taught. There is no other way to find the yield except through trial and error.

I am thinking that a custom recursive function could be built in Filemaker to do this, but I am not sure how to do it.

Currently, I export the information, then use an excel file with a macro to calculate the yield. Then I import the result.

If anyone has any ideas, it would be helpful.

[comment]

IIUC, in order to calculate the yield, the function must iterate until the price based on the proposed yield value matches the given price. For this, you would first need to know how to calculate the bond price, given the required yield - which I believe can be done by a non-recursive calculation.