How to use PRICEDISC Function in Excel

The Excel PRICEDISC function returns the price per $100 face value of a discounted security.

Syntax:= PRICEDISC(settlement, maturity, discount, redemption, [basis])

The PRICEDISC function syntax has the following arguments:

  • Settlement    Required. The security’s settlement date. The security settlement date is the date after the issue date when the security is traded to the buyer.
  • Maturity    Required. The security’s maturity date. The maturity date is the date when the security expires.
  • Discount    Required. The security’s discount rate.
  • Redemption    Required. The security’s redemption value per $100 face value.
  • Basis    Optional. The type of day count basis to use.
Basis Day count basis
0 or omitted US (NASD) 30/360
1 Actual/actual
2 Actual/360
3 Actual/365
4 European 30/360

Example: Let’s look at some Excel PRICEDISC function examples and explore how to use the PRICEDISC function as a worksheet function in Microsoft Excel:

In the following example, the Excel Pricedisc function is used to calculate the price per $100 face value of a discounted security purchased on 15-Jan-2019, with maturity date 15-Apr-2019 and a discounted rate of 6.50%. The redemption value is $100 and the Actual/360 day count basis is used:

PRICEDISC Function - How to use PRICEDISC Function in Excel

Syntax:  =PRICEDISC(B1,B2,B3,B4,B5)

Result: 98.375

PRICEDISC Function in Excel - How to use PRICEDISC Function in Excel

Note:

  1. #NUM! error – Occurs if either:
    1. The settlement date is greater than or equal to maturity date;
    2. When we provide invalid numbers for the arguments: the rate of discount, redemption or basis. That is, if we have provided a discount rate is less than or equal to zero, a redemption value is less than or equal to less than zero, or a basis that is a number other than 0,1,2,3,4.
  2. #VALUE! error – Occurs if:
    1. The given settlement or maturity arguments are invalid Excel dates.
    2. Any of the given arguments are non-numeric.
  3. PRICEDISC is calculated as follows:
READ:  How to use NOMINAL Function in Excel

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