FV: Calculating the future value of an investment


show more FV: Calculating the future value of an investment provides you with in-depth training on Business. Taught by Curt Frye as part of the Excel 2010: Financial Functions in Depth show less
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FV: Calculating the future value of an investment

One of the more conservative investment strategies is to purchase a certificate of deposit or another fixed-rate annuity that trades lower risk for a relatively low but known rate of return. You can evaluate this type of investment using the future value or FV function. The FV function has five arguments and I've laid those out in this workbook. The first is the rate and that is the annual percentage rate. Then next is periods and that is the number of periods over which interest will be accumulated.

So in this case, I have it set as 5 years. Then the next argument is the payment and this is the payment that you make every period. So for example in this case every year you'll put in an additional $10,000. Then we have the present value and that is $100,000 and that's the amount that you start with. You can think of it as a down payment on a house for example. Now both present value and payment are negative numbers, so they're displayed in parentheses. And the reason they...

FV: Calculating the future value of an investment
Video duration: 2m 48s 2h 18m Intermediate

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FV: Calculating the future value of an investment provides you with in-depth training on Business. Taught by Curt Frye as part of the Excel 2010: Financial Functions in Depth

Subjects:
Business IT
Software:
Excel
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