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8.0

Formula for Calculating rate of return on a series of investments

Asked by Apex623 in Microsoft Excel Spreadsheet Software, Microsoft Applications

Tags: microsoft office, microsoft excel

I am trying to come up with a formula that would cacluate my return on investments at different rates.   Essentially I would have annual cash flow that would be set a side in a fund until it is needed to repay a future debt.   Data would look like below:

14 year loan (no payment year 1)

Pmt                 Rate  
296,789          3.88%    (13 year investment)
296,789          3.75%    (12 year investment)
296,789          3.61%    (11 year investment)
296,789          3.47%    (10 year investment)
296,789          3.34%     (9 year investment)
296,789          3.19%     (8 year investment)

As I make payments to a fund annually I would buy investments that would mature the year my loan is due.  Each year the investment maturity is a year shorter to meet the future repayment of the loan in 14 years.   What I want to do is figure out what my combined rate of return on my escrowed payments at each investment rate will be assuming I continue to purchase securities each year at rate slightly less than the year before due to the shorter maturitity.

I hope this make since.  Essentially what is the wieghted average rate that I earned in the fund assuming the investment portfolio purchased.
[+][-]11/02/09 07:31 PM, ID: 25725857Accepted Solution

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Zones: Microsoft Excel Spreadsheet Software, Microsoft Applications
Tags: microsoft office, microsoft excel
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Solution Provided By: brettdj
Participating Experts: 1
Solution Grade: A
 
[+][-]11/03/09 07:32 AM, ID: 25729885Author Comment

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[+][-]11/03/09 08:42 PM, ID: 25736453Expert Comment

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