Forward Rates Part 2: Forward Yield Table

In the last post, Forward Rates Part 1: Gap Analysis, we calculated the forward rate for a two year fixed rate investment, five years from now. Here is a review of the math: Why is everything multiplied by 2? That’s because we are assuming semiannual compounding. First...
Continue reading »

Forward Rates Part 1: GAP Analysis

  Gap Analysis, sometimes referred to as breakeven analysis, will get us 3/4 of the way to understanding forward rates. There are three different interest rates involved with gap analysis: Term Rate: Security with the longest term to maturity. Head Rate: A shorter maturity alternative to the Term Rate....
Continue reading »

Lump Sum Calculator

Last week I showed  a cash flow calculator for even cash flows give dates. This next calculator solves for one time (lump sum) cash flows. Excel has built in functions for all of these, but this one is slightly different , in that it uses...
Continue reading »

Even Cash Flow Calculator

This worksheet just might make calculating things like loan payments, the amount that could be borrowed, the interest rate, etc. a little easier than the HP-12C calculator, with Reverse Polish Notation, you have been holding onto for the last 30 years. Their are five inputs to the...
Continue reading »

Interpolation

There has been an addition to the spreadsheet, explained in the post:  Simplified Linear Interpolation of Treasury Rates Back in the day, when I was building a pricing model for mortgages that would be sold to FNMA, I ran into a problem with their pricing...
Continue reading »

APR Calculator for PayDay Loans

Most banks and credit unions offer payday loans. So do many check cashing stores and online sites. You can find payday loan calculators online, but as far as I can find, they don’t give the option of telling you if the fee or interest charged...
Continue reading »

Valuing Servicing With CPR

Long before I wrote user defined functions for valuing servicing on a pool of mortgages, I developed amortization tables to understand the cash flows and proof my VBA. The amortization schedule provided below is not the typical amortization. It has a number of uses besides explaining the...
Continue reading »

Dashboard for Bonuses

After the end of the year, it is time to start thinking about budgets and goals. It is also time to set goals for next years bonuses. The linked  Excel workbook shows six  year- end objectives (targets), along with a threshold and a stretch for each goal. The threshold is a level...
Continue reading »

No XNFV Excel Function?

You might have already used the XNPV built-in Excel function for calculating the present value of a stream of cash flows with dates. How about XNFV for future value?  Wait a minute. There is no XNFV. It would have been easy to include an XNFV function,...
Continue reading »