# compoundInterest: compute compound interest In FinTS: Companion to Tsay (2005) Analysis of Financial Time Series

## Description

Compute compound interest for a given number of periods, compounding with an indicated frequency per period.

## Usage

 ```1 2 3``` ```compoundInterest(interest,periods=1,frequency=1,net.value=FALSE) simple2logReturns(R) ```

## Arguments

 `interest` rate of interest per period (usually per year) `periods` number of periods over which to compound `frequency` number of times per period to compound; frequency=Inf to convert simple to log returns `net.value` if TRUE, return the total value per unit invested; otherwise return net increase = (net value - 1) `R` simple interest to be converted to log(returns)

## Details

These functions are vectorized for all arguments. (The code uses optionally expm1(x) = (exp(x) - 1) and log1p(x)=(log(1+x) which can preserve numerical precision for x very close to 0.)

## Value

vector of the length of the longest argument.

## References

Ruey Tsay (2005) Analysis of Financial Time Series, 2nd ed. (Wiley, p. 6)

## Examples

 ```1 2 3 4 5 6 7 8``` ```# "Net Value" column of Tsay Table 1.1, p. 4 compoundInterest(0.1, frequency=c(1, 2, 4, 12, 52, 365, Inf), net.value=FALSE) # Example 1.1, p. 6 compoundInterest(.0446, freq=Inf) # Inverse of Example 1.1 simple2logReturns(.0456) ```

FinTS documentation built on May 29, 2017, 9:08 a.m.