redemption: A number value representing the redemption value per $100 of par value. redemption is calculated as redemption value / face value * 100 and it must be greater than 0. Often, it is 100, meaning that the security’s redemption value is equal to its face value.
days-basis: An optional European method for dates falling on the 31st of a month.
Examples
Suppose you are considering the purchase of a hypothetical discount security. The security settles May 1, 2009 (settle), matures at 100 per $100 of face value (redemption is 100) on June 30, 2015 (maturity). The security is being offered at 65.98 (price).
=YIELDDISC("05/01/2009", "06/30/2015", 65.98, 100, 0) returns approximately 8.36502410155835%, which represents the annual yield based on the assumptions given and assuming interest is calculated based on the 30/360 days interest convention.
=YIELDDISC("05/01/2009", "06/30/2015", 65.98, 100, 1) returns approximately 8.3639092604964%, which represents the annual yield based on the assumptions given and assuming interest is calculated based on actual days.