The Excel PRICE Function

Related Functions:
RATE function
YIELD function

Function Description

The Excel Price function calculates the price, per $100 face value of a security that pays periodic interest.

The syntax of the function is:

PRICE( settlement, maturity, rate, yld, redemption, frequency, [basis] )

Where the arguments are as follows:

settlement-The settlement date of the security (i.e. the date that the coupon is purchased).
maturity-The maturity date of the security (i.e. the date that the coupon expires).
rate-The security's annual coupon rate.
yld-The annual yield of the security.
redemption-The security's redemption value per $100 face value.

The number of coupon payments per year. This must be one of the following:

[basis]-An optional integer argument which specifies the financial day count basis that is used by the security. Possible values are:
BasisDay Count Basis
0 (or omitted)US (NASD) 30/360
4European 30/360
The financial day count basis rules are explained in detail on the Wikipedia Day Count Convention page

Warning: If you enter text representations of dates into Excel functions, the interpretation of these can vary, depending to the date system and date interpretation settings on your computer. Therefore, the settlement and maturity dates should be entered into the Price function as either:


Excel Price Function Example

In the following example, the Excel Price function is used to calculate the price per $100 face value of a security purchased on 01-Apr-2012, with maturity date 31-Mar-2020 and a rate of 12%. The yield is 10% and the redemption value is $100. Payments are made semi-annually and the US (NASD) 30/360 day count basis is used:

1Settlement Date:01-Apr-2012
2Maturity Date:31-Mar-2020
3=PRICE( B1, B2, 12%, 10%, 100, 2 )

The above function returns the value 110.8344836.

I.e. a security with the above terms would be valued at $110.83.

Note that, in the above example:

For further examples of the Excel Price function, see the Microsoft Office website.

Price Function Errors

If you get an error from the Price function, this is likely to be one of the following:

Common Errors

Occurs if either:

  • The settlement date ≥ maturity date
  • Invalid numbers are supplied for the rate, yld, redemption, frequency or [basis] arguments.
    (I.e. if either: rate < 0; yld < 0; redemption ≤ 0; frequency is any number other than 1, 2 or 4; or [basis] is any number other than 0, 1, 2, 3 or 4).

Occurs if either:

  • The supplied settlement or the maturity arguments are not valid Excel dates
  • Any of the supplied arguments are non-numeric.