The `RECEIVED` function in Excel is used to calculate the amount received at maturity for a fully invested security, such as a bond. It is particularly useful for financial analysts dealing with fixed-income investments.
Syntax
RECEIVED(settlement, maturity, investment, discount, [basis])
Arguments
- settlement: (Required) The settlement date of the security, which is the date after the issue date when the security is traded to the buyer. This date must be later than the issue date.
- maturity: (Required) The maturity date of the security, which is the date when the security expires.
- investment: (Required) The amount of money invested in the security.
- discount: (Required) The discount rate of the security.
- basis: (Optional) The day count basis to use. This is a numerical value that specifies the method used to calculate the number of days between two dates. Possible values are:
- 0 or omitted: US (NASD) 30/360
- 1: Actual/actual
- 2: Actual/360
- 3: Actual/365
- 4: European 30/360
Example
Suppose you want to calculate the amount to be received at maturity for a security with the following details:
- Settlement Date: January 15, 2023
- Maturity Date: January 15, 2024
- Investment Amount: $10,000
- Discount Rate: 5%
You can input the formula in an Excel cell as follows:
=RECEIVED("2023-01-15", "2024-01-15", 10000, 0.05)
This formula will give you the amount received at maturity based on the specified investment and discount rate.
Tips
- Date Input: Ensure that your dates are entered in a recognizable date format, such as `DATE(2023,1,15)` for January 15, 2023.
- Units: Ensure that the discount rate is expressed appropriately, usually in percentage form (e.g., 0.05 for 5%).
- Basis Selection: Choosing the correct day count basis is important for accurate calculation, as it affects the computation of the discount rate’s impact over time.
By using the `RECEIVED` function with appropriate arguments, you can easily determine the maturity value of a security in Excel.
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