Daily rate: Difference between revisions
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Not to be confused with the ''annual effective'' rate, which in this case would be 1.00014<sup>365</sup> - 1 = 5.24%. | Not to be confused with the ''annual effective'' rate, which in this case would be 1.00014<sup>365</sup> - 1 = 5.24%. | ||
== See also == | == See also == | ||
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* [[Nominal annual rate]] | * [[Nominal annual rate]] | ||
* [[Periodic rate of interest]] | * [[Periodic rate of interest]] | ||
[[Category:Interest_Rate_Risk]] | |||
Revision as of 14:00, 9 October 2013
The daily rate of interest (or yield) is a quoting convention for the simple interest nominal annual rate for compounding once per day.
For example, if the quoted daily rate is 5.11%, the amount of interest compounded daily is 5.11%/365 = 0.014%.
Not to be confused with the annual effective rate, which in this case would be 1.00014365 - 1 = 5.24%.
