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Daily Accrued and Compounded Interest

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    Daily Accrued and Compounded Interest

    In the below file (link to download), N2 was a goal seek to make G4 = G6. Essentially, I am trying to solve for the daily accrued and compounded interest rate that would create the same amount of total accrued interest as 12% compounded monthly. What formula will accomplish this goal?

    Much thanks for any help.
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    Last edited by InVinoVeritas; 07-12-2019 at 04:44 PM.

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    Re: Daily Accrued and Compounded Interest

    Please attach your file directly to your post. Most people are not willing to download from an untrusted web site.

    The paper clip icon does not work for attachments. To attach a file, under the text box where you type your reply click the Go Advanced button. On the next screen scroll down and click on Manage Attachments, which will show a pop-up window to Select and Upload a file. Then close the window.
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    Re: Daily Accrued and Compounded Interest

    Done, thank you for the help!

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    Re: Daily Accrued and Compounded Interest

    I find that I must first understand the math behind a problem before I can program a solution. At first glance, you spreadsheet seems to be describing some kind of present value/future value problem (I am not very good at financial calculations, so I am a little uncertain exactly what kind of present value/future value problem it is).

    Looking at the calculations in block [1], it looks like a basic PV()/FV() type calculation -- start at 1e6 and compound daily for COUNT(K2:K369)=366 days. Using the FV() function =FV(N2,366,0,1E6) I get a future value of -1,126,825 -- which matches the value at the bottom of the EOP balance column. This suggests to me that the problem fits into the standard PV() family of functions (PV() function help file: https://support.office.com/en-us/art...1-da16e8168cbd ). The PV() family of functions has a built in RATE() function that will find the interest rate if I feed it the correct present value and future value and other parameters. https://support.office.com/en-us/art...0-83fc59e748ce Present value is 1E6, future value is the same as that given in the block [3] calculation (X33), nper is still 366, so =RATE(366,0,-1E6,X33) seems to return the correct interest rate.

    If you are unfamiliar with Excel's built in PV() family of functions (or the NPV() or XNPV() families), you might spend some time with them to understand how they work. If you need to review basic financial math principles of present value/future value problems, you might spend some time with your financial math text or an online tutorial to review how present value/future value problems work and how they apply to this kind of problem.
    Quote Originally Posted by shg
    Mathematics is the native language of the natural world. Just trying to become literate.

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