Calculate a yield curve | Free template

Calculate a yield curve is a free template to establish a yield curve for the money market which describes the relationship between interest rate and remaining days to maturity.

A yield curve shows the expectations of the investors on the money market in terms of future interest rates. Yield curves can be constructed with simple annual interest rates or annual compound interest rates. It is fairer and most accurate to use the annual compound interest rate when constructing yield curves because the annual compound interest rate is taking the compound interest effect into account. In this template to calculate a yield curve the graph is based on annual compound interest rates.

A yield curve can have a positive, horizontal or negative slope depending on the interest rate expectations. If the yield curve has a positive slope the expectations are that interest rates will rise in the future, if the yield curve has a horizontal slope no changes in interest rate are expected and if the yield curve has a negative slope there are expectations of a decline in interest rates.

You can use this template to establish a yield curve for different maturities in the money market in order to see what expectations the money-market investor has about the future interest rates. Updated: 01/01/2015 | Created by All-templates.biz

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Tags: money market interest rates financial calculations excel