Table Illustrating Annualisation
Conventions
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See Annualisation
Conventions for a further explanation of annualisation conventions. See MnRestateYieldOrDiscount
for a Nematrian web service function that allows you to calculate the impact of
different annualisation conventions for arbitrary interest rates.
Illustrative impact of different annualisation
conventions, where amounts shown in columns 4, 5, 6 and 7 are amounts by which
an investment of 1 will grow to after one year for the given interest /
discount rate (with relevant annualisation convention):
|
Type of rate
|
Annualisation
convention
|
Parameter used to
code this quote basis
|
Amount after 1 year
|
Amount after 1 year
|
Amount after 1 year
|
Amount after 1 year
|
Rate equivalent to
an annually compounded rate of 10% pa
|
|
|
|
|
-5% pa
|
1% pa
|
10% pa
|
30% pa
|
pa
|
|
‘interest’
|
annual
|
1
|
95.00
|
101.00
|
110.00
|
130.00
|
10.00%
|
|
‘interest’
|
semi-annual
|
2
|
95.06
|
101.00
|
110.25
|
132.25
|
9.76%
|
|
‘interest’
|
quarterly
|
4
|
95.09
|
101.00
|
110.38
|
133.55
|
9.65%
|
|
‘interest’
|
monthly
|
12
|
95.11
|
101.00
|
110.47
|
134.49
|
9.57%
|
|
‘interest’
|
weekly
|
52
|
95.12
|
101.00
|
110.51
|
134.87
|
9.54%
|
|
‘interest’
|
daily
|
365
|
95.12
|
101.01
|
110.52
|
134.97
|
9.53%
|
|
‘interest’ or ‘discount
|
continuous
|
0
|
95.12
|
101.01
|
110.52
|
134.99
|
9.53%
|
|
‘discount’
|
daily
|
-365
|
95.12
|
101.01
|
110.52
|
135.00
|
9.53%
|
|
‘discount’
|
weekly
|
-52
|
95.13
|
101.01
|
110.53
|
135.10
|
9.52%
|
|
‘discount’
|
monthly
|
-12
|
95.13
|
101.01
|
110.56
|
135.50
|
9.49%
|
|
‘discount’
|
quarterly
|
-4
|
95.15
|
101.01
|
110.66
|
136.59
|
9.42%
|
|
‘discount’
|
semi-annual
|
-2
|
95.18
|
101.01
|
110.80
|
138.41
|
9.31%
|
|
‘discount’
|
annual
|
-1
|
95.24
|
101.01
|
111.11
|
142.86
|
9.09%
|
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