How to Calculate the Par Value of a Bond

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Calculating the par value of a bond is simple by looking at the initial purchase price of the bond, as the par value is generally the issues value as well as the ending value. Find the par value of a bond with financial advice from an experienced portfolio manager in this free video on investing.

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Video Transcript

OK so how do we calculate the par value of a bond? Well the par value is actually the issues value, it's also the ending value of the bond. The bonds, generally bonds are issued at a thousand dollars per share and sometimes those will show on a statement as one hundred, just meaning one hundred percent of the original price. So when you're trying to calculate the par, you're not really calculating it, you're really just looking at it for statement on what the issue price was and par again, is generally a thousand dollars. You buy the bond for a thousand dollars, it may fluctuate in price and pay its return during that point in time and then it's going to be redeemed at the same price that you purchased it for if you purchased it at par. So if you're looking for par value, maybe you own a bond and you're looking at letting it run to its maturity, the par value is going to be that original price.


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