ACCRINTM

The ACCRINTM function is used to calculate the accrued interest for a security that pays interest at maturity. It is particularly useful for analyzing and managing fixed income investments, such as zero-coupon bonds or Treasury bills, where interest is paid at the time of maturity rather than periodically.

Syntax

=ACCRINTM(Issue, Settlement, Rate, Par, [Basis])

Issue Date of the security's issue or start date of the investment period.
Settlement Date when the security was purchased or the end date of the investment period.
Rate Annual interest rate of the security.
Par The security's par value or face value at maturity.
Basis (Optional) The day-count basis to use. Defaults to 0 if omitted.

About ACCRINTM

When dealing with investments such as zero-coupon bonds or Treasury bills, where interest is paid at maturity rather than periodically, the ACCRINTM function in Excel comes to the rescue. It offers a convenient means of ascertaining the accrued interest on such securities, equipping financial analysts and investment managers with an essential tool for accurate interest calculations at maturity dates. This function facilitates meticulous assessment of interest income and financial planning for fixed-income investments that mature at a specific date in the future. Utilizing ACCRINTM entails supplying essential details about the security, including the issue or start date, the settlement or purchase date, the annual interest rate, the face value at maturity, and the chosen day-count basis to ensure precise interest calculations.

Examples

Assume you bought a zero-coupon bond with a par value of $5,000 that matures on December 31, 2022, at an annual interest rate of 4%. The bond was issued on January 1, 2022. To calculate the accrued interest on October 15, 2022, the ACCRINTM formula would be: =ACCRINTM("01/01/2022", "10/15/2022", 0.04, 5000, 0) This will provide the accrued interest amount for the specified bond from January 1, 2022, to October 15, 2022.

Suppose you invested in a Treasury bill with a face value of $10,000 and an annual interest rate of 2.5%, maturing on June 30, 2023. The bill was issued on August 1, 2022. To calculate the accrued interest on April 1, 2023, using the actual/actual day-count basis, the ACCRINTM formula would be: =ACCRINTM("08/01/2022", "04/01/2023", 0.025, 10000, 1) This will provide the accrued interest amount for the specified Treasury bill from August 1, 2022, to April 1, 2023, using the actual/actual day-count basis.

Questions

How is the accrued interest calculated by the ACCRINTM function?

The ACCRINTM function calculates the accrued interest using the following formula: Accrued Interest = (Rate * Par * Days) / 360

Can I use the ACCRINTM function for securities with periodic interest payments?

No, the ACCRINTM function is specifically designed for securities that pay interest at maturity. For securities with periodic interest payments, you should use the ACCRINT function instead.

Can I specify a different day-count basis for the ACCRINTM function?

Yes, you can specify a different day-count basis using the optional Basis argument. The default value is 0, representing the 30/360 day-count basis. You can choose to use other day-count bases, such as actual/actual or actual/360, by providing the appropriate numeric code as the Basis argument.

Related functions

ACCRINT
COUPDAYS
COUPDAYSNC
COUPNCD
COUPNUM
COUPPCD
MDURATION
YIELD
YIELDDISC
YIELDMAT