DURATION Function Explained
The DURATION function in Microsoft Excel calculates the number of periods required to reach a future value given an initial principal, periodic interest rate, and periodic payment. It is useful for calculating the number of payments required to pay off a loan or the number of periods required to reach a certain investment goal.
DURATION Function Syntax
DURATION(settlement, maturity, coupon, yld, frequency, [basis])
- settlement: 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: The security’s maturity date. The maturity date is the date when the security expires.
- coupon: The security’s annual coupon rate.
- yld: The security’s annual yield.
- frequency: The number of coupon payments per year.
- basis: The type of day count basis to use. The default is 0 (US (NASD) 30/360).