Purchase Date = K20 = 4/9/2012
Maturity = L20 = 11/1/2017
Coupon = M20 = 8.63%
Percent of Par at Purchase = N20 = 94%
Par Value = D20 = $1000
Pays Bi Annually

Using the YIELD function I enter:

=YIELD(K20,L20,M20,N20*D20,D20,2)

This is giving back 2.01% which looks wrong. If we are buying the bond at
less than par, how can a yield to maturity be lower than the coupon value of
8.63%?

Where is error in this formula?


Hi

Not sure about the error, but using your structure & equation I got this
answer: 2.32%

Cheers
Mick.