Clean price vs dirty price: what bond quotes actually mean
Almost every bond screen shows the clean price. Almost every settlement uses the dirty price. The difference is accrued interest, and it changes by the day.
The direct answer
Clean price is the quoted price of a bond excluding accrued interest. Dirty price is the clean price plus accrued interest — it is the amount that actually changes hands on settlement.
If you buy a bond between coupon dates, you compensate the seller for the interest that has accrued since the last coupon. That accrual sits inside the dirty price; stripping it out gives the clean price, which is the only quote that does not jump on coupon-payment days.
When each is used
| Context | Convention | Why |
|---|---|---|
| Screen quotes (Bloomberg, BondTerminal) | Clean price | Stable across coupon dates; comparable over time |
| Trade tickets / settlement | Dirty price | Reflects the actual money to be exchanged |
| Yield calculations | Either — same result | Yield is solved from the dirty cash flow at settlement |
| Total-return performance | Dirty price | Captures both price moves and accrued income |
Frequently asked questions
Which price does BondTerminal quote?
BondTerminal's calculator shows clean price as the primary input and displays accrued interest and dirty price separately so you can see both. This matches the convention used on Bloomberg, Reuters, and most trading platforms.
Does yield to maturity change between clean and dirty price?
No. The YTM is the same either way — it is solved from the full set of future cash flows discounted to the dirty (cash-on-the-table) price at settlement. You can think of it as: clean price plus accrued interest equals the present value of all remaining coupons and principal.
Why do two bond screens quote the same bond differently?
Most differences come from day-count conventions and settlement assumptions, not clean-vs-dirty. Check that both screens use the same day-count (e.g., 30/360 vs ACT/ACT) and the same settlement date. BondTerminal exposes both so you can reconcile.
What happens to the clean price on a coupon date?
Clean price is continuous through coupon dates. Dirty price drops by the coupon amount on ex-coupon day because the accrued interest resets to zero. That is exactly why traders quote clean — it removes the coupon-day discontinuity.