how do I caluclate return on investment, compounded quarterly?
SAR wrote:
We can calculate the return on investment with no problem. What we want to
do is make the rate compound quarterly, rather than annualy.
Notwithstanding the question about your numbers, the answer to your
question is....
If the annual IRR is "r", the equivalent quarterly compounded rate is
one of the following, which are equivalent:
=(1+r)^(1/4) - 1
=rate(4, 0, -1, 1+r)
This assumes that "r" is either expressed as percentage (e.g. 12%) or
as a fraction (e.g. 0.12).
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