# Semi-annual basis

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The quotation of a rate of return, or a cost, on the basis of a nominal annual rate for compounding twice per year.

**Example**

**Q.**

A rate of return - quoted as an annual effective rate - is 4.04%.

What is this same rate of return quoted on a semi-annual basis?

**A.**

The same rate of return quoted on a semi-annual basis is:

(1.0404^{(1/2)} -1) x 2

= 4.00%.

It is sometimes written as *semiannual*, without the hyphen.