Join Curt Frye for an in-depth discussion in this video DISC: Calculating the discount rate of a security, part of Excel 2010: Financial Functions in Depth.
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When you evaluate an investment, you will know such things as settlement date,…the maturity date, the amount you have to invest, and the amount you get back.…What you might not know is the investment's discount rate.…And the discount rate is the rate of a guaranteed investment such as a T-Bill.…So in other words what is the discount rate that the creators of this investment…assumed when they created it?…In Excel you can use the DISC function to discover the discount rate of a security.…The DISC function has the following five arguments.…
the first is the Settlement date and that is the date that you buy into the investment.…Next is the maturity date. That is the date that you get the proceeds from the investment.…Then we have the price per $100, just the amount it takes to buy in.…Redemption value per 100, that's the amount you get back at the end of the…investment on the maturity date.…And then the basis and a basis is how interest is calculated based on the length…of months and years.…In the US the standard is to use 30-day months and that means it is a…
- Analyzing loans, payments, and interest
- Discovering the interest rate of an annuity
- Determining depreciation using the straight line, declining balance, double-declining balance, and other methods
- Calculating the future value of an investment with variable returns
- Finding the discount rate of a security
- Converting between fractional prices and decimal prices
- Determining the yield of securities that pay interest periodically
Skill Level Intermediate
Managing and Analyzing Data in Excel 2010with Dennis Taylor1h 32m Appropriate for all
Excel 2010: Data Validation in Depthwith Dennis Taylor59m 45s Intermediate
1. Analyzing Loans, Payments, and Interest
2. Calculating Depreciation
3. Determining Values and Rates of Return
4. Calculating Bond Coupon Dates and Security Durations
5. Calculating Security Prices and Yields
6. Calculating Prices and Yields of Securities with Odd Periods
Additional resources1m 5s
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