Owner manual
YIELDDISC
The YIELDDISC function returns the eective annual interest rate for a security that is
sold at a discount to redemption value and pays no interest.
YIELDDISC(settle, maturity, price, redemption, days-basis)
 settle: The trade settlement date. settle is a date/time value. The trade settlement
date is usually one or more days after the trade date.
 maturity: The date when the security matures. maturity is a date/time value. It must
be after settle.
 price: The cost of the security per $100 of par value. price is a number value.
 redemption: The redemption value per $100 of par value. redemption is a number
value that must be greater than 0. redemption is the amount that will be received
per $100 of face value. Often, it is 100, meaning that the security’s redemption value
is equal to its face value.
 days-basis: An optional argument specifying the number of days per month and
days per year used in the calculations.
30/360 (0 or omitted): 30 days in a month, 360 days in a year, using the NASD
method for dates falling on the 31st of a month.
actual/actual (1): Actual days in each month, actual days in each year.
actual/360 (2): Actual days in each month, 360 days in a year.
actual/365 (3): Actual days in each month, 365 days in a year.
30E/360 (4): 30 days in a month, 360 days in a year, using the European method for
dates falling on the 31st of a month (European 30/360).
Example
In this example, the YIELDDISC function is used to determine the eective annual yield of the
hypothetical security described by the values listed. The security does not pay interest and is sold at
a discount.
The function evaluates to approximately 8.37%, which represents the annual yield at a price of
approximately $65.98 per $100 of face value.
settle maturity price redemption days-basis
=YIELDDISC (B2,
C2, D2, E2, F2)
05/01/2009 06/30/2015 65.98 100 0
152 Chapter 6 Financial Functions