Qualitative characteristics of useful financial information and Quarterly rate: Difference between pages
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'' | The quarterly rate of interest (or yield) is a quoting convention for the simple interest ''nominal annual rate'' for compounding once per quarter (four times per year). | ||
For example, if the quoted quarterly rate is 6.00%, the amount of interest compounded quarterly is 6.00%/4 = 1.50%. | |||
Not to be confused with the related ''annual effective'' rate, which in this case is 1.015<sup>4</sup> - 1 = 6.14%. | |||
== See also == | == See also == | ||
* [[ | * [[Annual effective rate]] | ||
* [[ | * [[Nominal annual rate]] | ||
* [[ | * [[Periodic rate of interest]] | ||
[[Category:Manage_risks]] | |||
Revision as of 13:59, 9 October 2013
The quarterly rate of interest (or yield) is a quoting convention for the simple interest nominal annual rate for compounding once per quarter (four times per year).
For example, if the quoted quarterly rate is 6.00%, the amount of interest compounded quarterly is 6.00%/4 = 1.50%.
Not to be confused with the related annual effective rate, which in this case is 1.0154 - 1 = 6.14%.