The Excel PRICEDISC Function

Related Functions:

PRICE function
YIELDDISC function

Function Description

The Excel Pricedisc function calculates the price, per $100 face value of a discounted security.

The syntax of the function is:

PRICEDISC( settlement, maturity, discount, redemption, [basis] )

Where the arguments are as follows:

settlement

The settlement date of the security (i.e. the date that the coupon is purchased).

maturity

The maturity date of the security (i.e. the date that the coupon expires).

discount

The security's percentage discount rate.

redemption

The security's redemption value per $100 face value.

[basis]

An optional integer argument that specifies the financial day count basis that is used by the security. Possible values are:

Basis	Day Count Basis
0 (or omitted)	US (NASD) 30/360
1	actual/actual
2	actual/360
3	actual/365
4	European 30/360

The financial day count basis rules are explained in detail on the Wikipedia Day Count Convention page

Warning: If you enter text representations of dates into Excel functions, the interpretation of these can differ, depending to the date system and date interpretation settings on your computer. Therefore, the settlement and maturity dates should be entered into the Pricedisc function as either:

References to cells containing dates

Dates returned from formulas.

Excel Pricedisc Function Example

In the following example, the Excel Pricedisc function is used to calculate the price per $100 face value of a discounted security purchased on 01-Apr-2017, with maturity date 31-Mar-2021 and a discounted rate of 2.5%. The redemption value is $100 and the US (NASD) 30/360 day count basis is used:

	A	B
1	Settlement Date:	01-Apr-2017
2	Maturity Date:	31-Mar-2021
3	=PRICEDISC( B1, B2, 2.5%, 100 )

The above function returns the value 90.00.

I.e. the price of security with the above terms would be $90.00.

Note that, in the above example:

As recommended, the settlement and maturity dates have been input as references to cells containing dates;
The discount argument is input as the percentage 2.5%. However, this could, instead, be entered as the simple numerical value 0.025;
The [basis] argument has been omitted, and so the function uses the default value 0 (denoting the US (NADS) 30/360 day count basis).

For further examples of the Excel Pricedisc function, see the Microsoft Office website.

Pricedisc Function Errors

If you get an error from the Pricedisc function, this is likely to be one of the following:

Common Errors

#NUM!

Occurs if either:

The settlement date ≥ maturity date;
Invalid numbers are supplied for the discount, redemption or [basis] arguments
(i.e. if either: discount ≤ 0; redemption ≤ 0; or [basis] is any number other than 0, 1, 2, 3 or 4).

#VALUE!

Occurs if either:

The supplied settlement or the maturity arguments are not valid Excel dates;
Any of the supplied arguments are non-numeric.

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