Investment Science: A list of useful excel sheets for computations

Tuesday, March 27, 2012

Has been planning to do this for sometime, but here is a list of excel sheet computations which I developed during my Investment Science course in Stanford, these may help you understand some investment related calculations (like mortgages, Net Present Value, Internal rate of return and so on), the one which may be of frequent use is the mortgage/loan payment schedule given the interest rate and the number of years, personally was of good use to me.

Note: Most of them may be in openoffice format, you may download openoffice software to use these.

1. Spreadsheet:Compound interest calculation

2. Spreadsheet:Calculating Net Present Value (NPV) and Internal rate of return (IRR)

Investment Science for Beginners

Monday, March 26, 2012

A couple of years back I took MS&E 242S - Investment Science course from Stanford where I got a chance to learn several concepts in investment science, some important ones I published as articles, listing a reference to all of them here so that this page serves as a definitive reference for some of the fundamental and important concepts in Investment Science.

Note: For some of the posts, you may need to refer Investment Science by Luenberger for problem statements, but they are also mentioned in the respective entries, also a few articles are meant to familiarize yourself with the basics of working with a financial calculator used to solve some of the problems in Investment science, the one I used being the Texas Instruments BA II Plus Financial Calculator, also familiarity with excel/openoffice spreadsheets may help as some of the problems were solved using spreadsheet/excel computations.

1.   Investment Science: Yearly, monthly and Continuous compounding

2.   Using math symbols in openoffice

3.   Investment Science: Effective and Nominal interest rates

4.   Investment Science: Present Value and Future Value of an investment

5.   Investment Science: Cash flow streams and their present and future values

6.   Investment Science: Present value analysis of cash flow streams - Problem 2.7 Luenberger

7.   Investment Science: Computing Net Present Value of a cash flow stream using a financial calculator

8.   Investment Science: Internal rate of return of a cash flow stream

9.  Investment Science: Computing the Internal rate of return of a cash flow stream using a financial calculator

10. Investment Science: Net Present Value and Internal rate of return calculations in spreadsheet (OpenOffice)

11. Investment Science: Net Present Value vs Internal rate of return analysis in investment decisions - Problem 2.11 Luenberger

12. Investment Science: Incremental internal rate of return for analyzing alternate investment options - Problem 2.8 Luenberger

13. Investment Science: Perpetual Annuity - How to compute your monthly loan payment

14. Investment Science - Understanding the mathematics of Mortgage payments - 1 - Problem 3.6 Luenberger

15. Investment Science: Amortization schedule of a Mortgage/loan payment

16. Investment Science: Variable rate Mortgage - Problem 3.8 Luenberger

17. Investment Science: The price of a bond and it's yield - Problem 3.9 Luenberger

18. Investment Science: Sum of a Geometric series and applications in computing Net Present Value

19. Investment Science: Duration of a bond - Problem 3.10 Luenberger

20. Investment Science: The price of a bond and it's relationship to the Present Value formula

21. Investment Science: Bond Portfolio Immunization

22. Investment Science: Bond Price Sensitivity

23. Investment Science: The Price of a bond and it's duration using excel/spreadsheet - Problem 3.10 Luenberger

24. Investment Science - Bond Portfolio Immunization Example - Problem 3.12 Luenberger

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