Simple interest

G

Gorthi

I invested 100$ 35 days back and got 122.75$ today, I want to calculte the
interest received
 
S

Stefi

(122.75*(365/35))/100-1=11.80107143=1180.11%
Please, let me know the next such investment opportunity!
Regards,
Stefi



„Gorthi†ezt írta:
 
G

Gorthi

Which function do i use in the Financial calculations? This mathematical way
is ok.
Is it the only way?
 
S

Stefi

Sorry, of course you are right. Next time I'll check my post more carefully.
237.25% interest is still not bad!

Stefi

„David Biddulph†ezt írta:
 
G

Gorthi

Is there no simple function in the financial calculations rather than doing
all this math?
 
F

Fred Smith

This is a straight percentage problem. The simple interest rate is
(122.75-100.00)/100.00 = 22.75%

If you want to annualize this rate, use the =Rate function.
 
F

Fred Smith

All financial functions use compound interest. You wanted simple interest. So
the answer is, no, there is no financial function for your calculation.
 
F

Fred Smith

Regardless of the result, the formula does not properly annualize the rate of
return. Your formula assumes you earn $22.75 every 35 days. However, if you
reinvested the $122.75 for 35 days at the same rate, you would earn $27.93.

The proper way to annualize the rate of return is to use the future value
function, as in:

=fv(22.75%,365/35,0,-1)-1 or 747.94%
 
D

David Biddulph

That would be fine if the investment had a compounding interval of 35 days,
but that would be an unusual interval; in many cases the compounding
interval is annual or biannual.
[But, as you said in another post, the OP asked for simple interest, not
compound interest.]
 
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