ACT/365 is a day count convention which calculates the actual days in a time period, over the actual number of days in a calendar year.
In a normal year, this will be 365 days.
In a leap year it is 366 days.
The day count convention should always be checked and confirmed expressly if appropriate before transacting.
Particular care must be taken where the day count convention differs between domestic markets and non-domestic markets.
The ACT/365 convention is also known as ACT/ACT, because the denominator is the actual number of days in the year.
The ACT/365 - or ACT/ACT - convention is also sometimes known as ACT/365 actual, or ACT/365 A.
The ACT/365 convention, described above, should not be confused with ACT/365 fixed.
Under the ACT/365 fixed convention, the number of days in the conventional year is fixed at 365 in all years (including leap years).