RATE OF RETURN

[Steveandshelly@gmail.com]

I am trying to calculate the following

contribution =A3100pm
Term 360 months
assumed growth 4% per annum, applied daily

I cannot use the FV function as I don't know how to work out what
figure to put in the rate of return box to give me daily applied
interest.

Can you help

[Niek Otten]

If you want to apply interest daily, you need to supply dates instead of #
of months, because leap years matter.
You can find the daily interest rate with the EFFECT function.

If you base your calculation on a 30-day, 12-month year, you can use FV with
the rate found with EFFECT (for days) and NOMINAL (for months)

--
Kind regards,

Niek Otten

<Steveandshelly@gmail.com> wrote in message
news:1141132745.543617.120160@z34g2000cwc.googlegroups.com...
I am trying to calculate the following

contribution £100pm
Term 360 months
assumed growth 4% per annum, applied daily

I cannot use the FV function as I don't know how to work out what
figure to put in the rate of return box to give me daily applied
interest.

Can you help

[joeu2004@hotmail.com]

"Steveandshelly@gmail.com" wrote:
> I am trying to calculate the following
> contribution £100pm
> Term 360 months
> assumed growth 4% per annum, applied daily
> I cannot use the FV function as I don't know how to work
> out what figure to put in the rate of return box to give me
> daily applied interest.

In the US, it is customary for the daily rate to be 4%/365.
I do not know the customs of your country. Based on US
customs, the effective monthly rate would be:

=fv(4%/365, 365/12,, -1) - 1

Thus, the FV of the monthly annuity compounded daily
would be:

=fv(fv(4%/365, 365/12,, -1) - 1, 360, -100)