Then substitute the annual interest rate 15% into the formula: monthly interest rate =15%12 = 1.25%, and monthly interest is1.25 cents.
The calculation method of annualized rate of return is to convert the current rate of return (daily rate of return, weekly rate of return, monthly rate of return) into annual rate of return, which is a theoretical rate of return, not an actual rate of return.
Annualized rate of return The annual rate of return converted from the net income per 10,000 fund shares of the Monetary Fund in the past seven days. There are two ways to carry forward money market funds: 1. "Daily dividends are carried forward on a monthly basis", which is equivalent to daily simple interest and monthly compound interest; 2. "Daily dividends are carried forward daily", which is equivalent to daily compound interest.
The annualized rate of return refers to the rate of return obtained by investing for one year.
Annualized rate of return = [(return on investment/principal)/investment days] *365 × 100%
Annualized income = principal × annualized rate of return
Actual income = principal × annualized rate of return × investment days /365
Under different income carry-over methods, the calculation formula of seven-day annualized rate of return should also be different. There are two ways to carry forward the income of money market funds. One is to pay dividends on a daily basis and carry them forward on a monthly basis, which is equivalent to daily simple interest and monthly compound interest; The other is daily dividend, which is carried forward on a daily basis, equivalent to daily compound interest, in which the formula for calculating simple interest is: (∑ ri/7) × 365/10000 ×100%, and the formula for calculating compound interest is: (∏ (1+ri/650).
It can be seen that the 7-day annualized rate of return is calculated according to the 7-day income, and the 30-day annualized rate of return is calculated according to the latest 1 month income.
The establishment of this index is mainly to provide investors with more intuitive data for investors to refer to when comparing the income of money funds with other investment products. In this indicator, the rate of return in the last seven days is determined by seven variables, so the same income in the last seven days does not mean that the net income per 10,000 fund shares in the seven times used for calculation is exactly the same.
Summary: Investors put the principal C into the market, and its market value becomes V after time t, so in this investment:
1, and the return is: p = v-c.
2. The rate of return is: K=P/C=(V-C)/C=V/C- 1.
3. The annualized rate of return is:
(1) y = (1+k) n-1= (1+k) (d/t)-1or
(2)y=(v/c)^n- 1=(v/c)^(d/t)- 1
Where N=D/T represents the number of repeated investments by investors within one year. D stands for the effective investment time of one year, with bank deposits, bills and bonds being D=360 days, stocks and futures being 250 days, and real estate and industry being D=365 days.
4. In the case of continuous multi-period investment, y = (1+k) n-1= (1+k) (d/t)-1.
Where: K=∏(Ki+ 1)- 1, T=∑Ti.