ODDFYIELD function

This article describes the formula syntax and usage of the ODDFYIELD function in Microsoft Excel.

Description

Returns the yield of a security that has an odd (short or long) first period.

Syntax

ODDFYIELD(settlement, maturity, issue, first_coupon, rate, pr, redemption, frequency, [basis])

Important   Dates should be entered by using the DATE function, or as results of other formulas or functions. For example, use DATE(2008,5,23) for the 23rd day of May, 2008. Problems can occur if dates are entered as text.

The ODDFYIELD function syntax has the following arguments:

  • Settlement    Required. The security's settlement date. The security settlement date is the date after the issue date when the security is traded to the buyer.

  • Maturity    Required. The security's maturity date. The maturity date is the date when the security expires.

  • Issue    Required. The security's issue date.

  • First_coupon    Required. The security's first coupon date.

  • Rate    Required. The security's interest rate.

  • Pr    Required. The security's price.

  • Redemption    Required. The security's redemption value per $100 face value.

  • Frequency    Required. The number of coupon payments per year. For annual payments, frequency = 1; for semiannual, frequency = 2; for quarterly, frequency = 4.

  • Basis    Optional. The type of day count basis to use.

Basis

Day count basis

0 or omitted

US (NASD) 30/360

1

Actual/actual

2

Actual/360

3

Actual/365

4

European 30/360

Remarks

  • Microsoft Excel stores dates as sequential serial numbers so they can be used in calculations. By default, January 1, 1900 is serial number 1, and January 1, 2008 is serial number 39448 because it is 39,448 days after January 1, 1900.

  • The settlement date is the date a buyer purchases a coupon, such as a bond. The maturity date is the date when a coupon expires. For example, suppose a 30-year bond is issued on January 1, 2008, and is purchased by a buyer six months later. The issue date would be January 1, 2008, the settlement date would be July 1, 2008, and the maturity date would be January 1, 2038, which is 30 years after the January 1, 2008, issue date.

  • Settlement, maturity, issue, first_coupon, and basis are truncated to integers.

  • If settlement, maturity, issue, or first_coupon is not a valid date, ODDFYIELD returns the #VALUE! error value.

  • If rate < 0 or if pr ≤ 0, ODDFYIELD returns the #NUM! error value.

  • If basis < 0 or if basis > 4, ODDFYIELD returns the #NUM! error value.

  • The following date condition must be satisfied; otherwise, ODDFYIELD returns the #NUM! error value:

    maturity > first_coupon > settlement > issue

  • Excel uses an iterative technique to calculate ODDFYIELD. This function uses the Newton method based on the formula used for the function ODDFPRICE. The yield is changed through 100 iterations until the estimated price with the given yield is close to the price. See ODDFPRICE for the formula that ODDFYIELD uses.

Example

Copy the example data in the following table, and paste it in cell A1 of a new Excel worksheet. For formulas to show results, select them, press F2, and then press Enter. If you need to, you can adjust the column widths to see all the data.

Data

Argument description

November 11, 2008

Settlement date

March 1, 2021

Maturity date

October 15, 2008

Issue date

March 1, 2009

First coupon date

5.75%

Percent coupon

84.50

Price

100

Redemptive value

2

Frequency is semiannual

0

30/360 basis

Formula

Description

R esult

=ODDFYIELD(A2, A3, A4, A5, A6, A7, A8, A9, A10)

The yield of a security that has an odd (short or long) first period, for the bond using the terms in cells A2:A10 as function arguments. Result is (0.0772, or 7.72%).

7.72%

Applies To: Excel 2013, Excel 2007, Excel 2010, Excel Starter, Excel Online, Excel for Mac 2011, Excel 2016 for Mac



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