The ODDLYIELD function in Excel is a specialized tool designed to compute the yield of a security that features an odd last period. This function is useful for financial analysts and investors who need to assess securities that do not conform to standard yield calculations, ensuring they receive accurate evaluations even for atypical scenarios.

Syntax

ODDLYIELD(settlement, maturity, rate, pr, redemption, frequency, [basis])

• settlement: The date when the security is purchased.
• maturity: The expiration date of the security.
• rate: The coupon interest rate of the security.
• pr: The price of the security.
• redemption: The redemption value of the security.
• frequency: The number of interest payments per year.
• [basis]: An optional parameter that defines the day count basis (default is 0).

Example #1

ODDLYIELD("2023-01-01", "2025-01-01", 0.05, 95, 100, 1)

This call estimates the yield of a security bought on January 1, 2023, maturing on January 1, 2025, with a 5% interest rate and a price of 95. The result might be approximately 5.74%.

Example #2

ODDLYIELD("2023-06-01", "2022-12-01", 0.04, 98, 100, 2)

In this instance, the function calculates the yield for a security purchased on June 1, 2023, maturing on December 1, 2022, with a 4% rate and a market price of 98. The expected yield could be around 3.21%.

Example #3

ODDLYIELD("2022-01-01", "2024-06-01", 0.03, 100, 1000, 1, 1)

This example computes the yield of a $1,000 security bought on January 1, 2022, maturing on June 1, 2024, with a 3% interest rate. The outcome may be about 2.91%.

Error handling

• VALUE! This error occurs when any of the parameters are non-numeric or incorrectly entered.
• NUM! Indicates a numeric calculation issue, typically arising from a negative number in a context where only positive numbers are applicable.
• NAME? This error appears when the function name is unrecognized, often due to a typo or an unrecognized syntax.

Conclusion

The ODDLYIELD function is invaluable for financial analysis, offering a precise method to calculate yield for securities with unusual last periods. By understanding its syntax, parameters, and potential errors, users can effectively utilize this function to enhance their investment strategies.