Buzz
In the process of stock market investment, understanding the value of bonds is indispensable. This article guides two methods of calculating bond valuations by comparing the ODDFPRICE and ODDLPRICE functions in Excel.
1. Comparison of Meaning
- Similarities:
+ Both functions are statistical functions.
+ They both return prices per $100 par value of the security.
- Differences:
+ ODDFPRICE Function: Returns the price per $100 par value of the security with an odd first period.
+ ODDLPRICE Function: Unlike ODDFPRICE, returns at odd last period. ODDLPRICE returns the price per $100 par value of the security with an odd last period.
2. Syntax Comparison
- ODDFPRICE (settlement, maturity, issue, first_coupon,,rate, yld, redemption, frequency, basis).
- ODDLPRICE (settlement, maturity, last_interest, rate, yld, redemption, frequency, basis).
Through the syntax of these two functions, we can observe:
- Similarities:
+ Both functions have the same number of parameters and identical parameters: settlement, maturity, rate, yld, redemption, frequency, basis.
+ The identical parameters have the same values or meanings.
- Differences: The two functions differ in the third parameter:
+ The ODDFPRICE function has the third parameter as first_coupon - representing the first interest payment date of the security.
+ The ODDLPRICE function has the third parameter as last_interest - indicating the last interest payment date of the security.
So in terms of syntax, both functions only differ in the third parameter, where one calculates the first interest payment date while the other calculates the last interest payment date of the security.
Note: Calculation formula of the ODDFPRICE function.
3. Comparison of function values through specific example
Example: Calculate the value of a bond with a redemption value (based on $100) and with an odd first interest period.
With the following data table:
Since the bond has an odd first interest period, the last period is also odd.
Thus, the bond value is determined at two different time points. The first time point is the first odd interest period, and the second time point is the last odd interest period.
- Calculate the bond value at the first odd interest period.
Since the bond value is calculated at the first odd interest period, use the ODDFPRICE function. In the cell where you want to calculate, enter the formula: =ODDFPRICE(B$7,C$7,D$7,E$7,F$7,G$7,H$7,I$7,J$7) and press Enter to get the result:
- Calculate the bond value at the last odd interest period.
Since the bond value is calculated at the last odd interest period, use the ODDLPRICE function. In the cell where you want to calculate, enter the formula: =ODDLPRICE(B11,C11,D11,E11,F11,G11,H11,I11).
Here are the similarities and differences between the ODDFPRICE and ODDLPRICE functions.
Wishing you success!
