ODDLYIELD Function

Calculates the yield of a security with an odd (short or long) last period

What is the ODDLYIELD Function?

The ODDLYIELD Function is categorized under Financial functions. It helps calculate the yield of a security with an odd (short or long) last period.

In financial analysis, some bonds come with irregular first or last periods. Due to the irregular first or last period, the payment sometimes doesn’t fit in any of the given patterns. If we wish to calculate the yield of a security with an odd last period, we can use the ODDLYIELD function for such bonds.

 

Formula

=ODDLYIELD(settlement, maturity, issue, last_interest, rate, pr, redemption, frequency, [basis])

 

The ODDLYIELD function uses the following arguments:

  1. Settlement (required argument) – It is the security’s settlement date. It is the date after the issue date when the security is traded to the buyer.
  2. Maturity (required argument) – It is the security’s maturity date. It is the date when the security expires.
  3. Last_interest (required argument) – It is the security’s last coupon date.
  4. Rate (required argument) – It is the security’s interest rate.
  5. Pr (required argument) – It is the security’s price.
  6. Redemption (required argument) – It is the security’s redemption value per $100 face value.
  7. Frequency (required argument) – It is the number of coupon payments per year. For annual payments, frequency = 1; for semiannual, frequency = 2; for quarterly, frequency = 4.
  8. Basis (optional argument) – It is the type of day count basis to use. The possible values of basis are:


BasisDay Count basis
0 or omittedUS(NASD) 30/360
1Actual/actual
2Actual/360
3Actual/365
4European 30/360

  

How to use the ODDLYIELD Function in Excel?

To understand the uses of the ODDLYIELD function, let’s consider an example:

 

Example

Let’s assume we have to calculate the price per $100 face value of a security with last interest date Jan. 31, 2017, settlement date Apr. 15, 2017, maturity date Jun. 30, 2017. The rate of interest is 5%, the price is $99.9 and the redemption value is $100. Payments are made quarterly and the US (NASD) 30/360 day count basis is used:

 

ODDLYIELD Function

 

The formula used is:

 

ODDLYIELD Function - Example 1

 

We get the result below:

 

ODDLYIELD Function - Example 1a

 

The above function returned the value 5.43%. In the example:

  • The date arguments were supplied to the ODDLYIELD function as references to cells containing dates.
  • The rate argument was entered as a percentage, 5%. However, we can enter the argument as the simple numeric values 0.005.
  • As we intend to omit the [basis] argument, the function uses the default value 0 (denoting the US (NADS) 30/360 day count basis).

 

Few notes about the ODDLYIELD Function:

  1. #NUM! error – Occurs when:
    • The last interest date is greater than or equal to the settlement date.
    • The given settlement date is greater than or equal to the maturity date.
    • We provided invalid numbers for the rate, pr, redemption, frequency or [basis] arguments. That is if either rate is less than 0; pr is less than 0; redemption is less than or equal to 0; frequency is any number other than 1, 2 or 4; or [basis] is any number other than 0, 1, 2, 3 or 4).
  2. #VALUE! error – Occurs when:
    • The given settlement, maturity, or issue arguments are not valid Excel dates.
    • Any of the given arguments is non-numeric.

 

Click here to download the sample Excel file

 

Additional resources

Thanks for reading CFI’s guide to important Excel functions! By taking the time to learn and master these functions, you’ll significantly speed up your financial analysis. To learn more, check out these additional resources:

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