YIELDDISC function

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

Description

Returns the annual yield for a discounted security.

Syntax

YIELDDISC(settlement, maturity, pr, redemption, [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 YIELDDISC 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.

  • Pr    Required. The security's price per $100 face value.

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

  • 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, and basis are truncated to integers.

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

  • If pr ≤ 0 or if redemption ≤ 0, YIELDDISC returns the #NUM! error value.

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

  • If settlement ≥ maturity, YIELDDISC returns the #NUM! error value.

Example

The example may be easier to understand if you copy it to a blank worksheet.

How do I copy an example?

  1. Select the example in this article. If you are copying the example in Excel Web App, copy and paste one cell at a time.Important Do not select the row or column headers.

    selecting an example from help

    Selecting an example from Help

  2. Press CTRL+C.

  3. Create a blank workbook or worksheet.

  4. In the worksheet, select cell A1, and press CTRL+V. If you are working in Excel Web App, repeat copying and pasting for each cell in the example.

  5. Important For the example to work properly, you must paste it into cell A1 of the worksheet.

  6. To switch between viewing the results and viewing the formulas that return the results, press CTRL+` (grave accent), or on the Formulas tab, in the Formula Auditing group, click the Show Formulas button.

  7. After you copy the example to a blank worksheet, you can adapt it to suit your needs.

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A

B

Data

Description

February 16, 2008

Settlement date

March 1, 2008

Maturity date

99.795

Price

$100

Redemption value

2

Actual/360 basis

Formula

Description (Result)

=YIELDDISC(A2,A3,A4,A5,A6)

The yield, for the bond with the terms above (0.052823 or 5.28%)

Note   To view the result as a percentage, select the cell, and then on the Home tab, in the Number group, click the arrow next to Number Format, and click Percentage.

Applies To: Excel 2010, Excel Starter, Excel Online, SharePoint Online



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