The Excel Pricedisc function calculates the price, per $100 face value of a discounted security.
The syntax of the function is :
Where the arguments are as follows:
|settlement||-||The settlement date of the security (ie. the date that the coupon is purchased)|
|maturity||-||The maturity date of the security (ie. the date that the coupon expires)|
|discount||-||The security's percentage discount rate|
|redemption||-||The security's redemption value per $100 face value|
|[basis]||-||An optional integer argument which specifies the financial day count basis that is used by the security. Possible values are:|
The financial day count basis rules are explained in detail on the Wikipedia Day Count Convention page
Note that the settlement and maturity arguments should be entered into the function as either:
In the following example, the Excel Pricedisc function is used to calculate the price per $100 face value of a discounted security purchased on 01-Apr-2011, with maturity date 31-Mar-2015 and a discounted rate of 2.5%. The redemption value is $100 and the US (NASD) 30/360 day count basis is used:
|3||=PRICEDISC( B1, B2, 2.5%, 100 )|
The function calculates the price per $100 face value to be $90.
Note that, in the above example:
Further examples of the Excel Pricedisc function can be found on the Microsoft Office website.
If you get an error from the Pricedisc function, this is likely to be one of the following:
Occurs when Analysis ToolPak add-in is not enabled in your Excel.