Money Markets by Hand: Discount Yields, Money-Market Yields, Day Counts, Short-Term Deposits, Repos & Cash-Fund Yields

What you'll build

What you will be able to do

Each lab ends with a concrete result that you build yourself and the checker confirms, cell by cell.

• Count the days of five short-term deposits, compute their interest with the right day-count convention from a lookup table, convert an ACT/360 rate to an ACT/365 rate and measure what the convention is worth on one deposit.
• Price four discount bills from their quoted discount rates, work out the price to bid for a target money-market yield and back out the discount rate implied by a dealer's price.
• Price four discount instruments per 100, convert each discount rate into a money-market yield and a bond-equivalent yield, and measure the gap in basis points.
• Compute the interest at maturity of four term-deposit offers, turn each rate into an effective annual yield, apply a fictional early-withdrawal penalty and compare rolling a 3-month deposit with one 12-month deposit.
• Work out how much cash Corvane lends against collateral after a haircut, the repo interest and the repurchase price of a one-week repo, then the interest of a week of overnight repos that include a weekend.
• Compute the gross proceeds of a 60-day paper issue, the dealer fee, the net cash Corvane actually receives and its all-in annual cost of funds.
• Deduct a daily fee from a week of gross income per unit, annualise the net income into a simple and a compounded 7-day yield and compute what Corvane's holding earned in the week.
• Set the maturity dates of five new placements with EDATE and WORKDAY, compute their interest, sort the current holdings into liquidity buckets with SUMIFS and chart how much cash comes back when.