Semi-annual rate: Difference between revisions
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imported>Doug Williamson (Link with Periodic yield page.) |
imported>Doug Williamson (Rationalise links.) |
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== See also == | == See also == | ||
* [[ | * [[Effective annual rate]] | ||
* [[Certificate in Treasury Fundamentals]] | |||
* [[Certificate in Treasury]] | |||
* [[CertFMM]] | * [[CertFMM]] | ||
* [[Nominal annual rate]] | * [[Nominal annual rate]] | ||
Revision as of 11:04, 27 October 2015
The semi-annual rate is the simple annual interest quotation for compounding twice a year.
For example if the semi-annual rate is quoted as 4%, then the periodic interest accruing is:
= 4% x 6/12
= 2% per six month period.
A semi-annual rate is an example of a nominal annual rate.
The semi-annual rate is not to be confused with the periodic rate per 6 months, which in this case is 2%.
Nor should it be confused with the related annual effective rate, which in this case would be:
= 1.022 - 1
= 4.04%.
