Excel
EFFECT function in Excel
Returns the effective annual interest rate
=EFFECT(nominal_rate, npery)EFFECT syntax and parameters
Two arguments, two required.
- nominal_ratenumberRequired
The nominal interest rate.
- nperynumberRequired
The number of compounding periods per year.
EFFECT examples
Formulas you'll actually reuse.
A 6% nominal rate compounded monthly is really 6.17% a year:
=EFFECT(6%, 12)Result
0.0617Daily compounding on the rate in B2 (5% → 5.13%):
=EFFECT(B2, 365)Result
0.0513
EFFECT in Google Sheets
Same name — your formula ports as-is.
Try EFFECT in the playground
Edit the example — nothing to install.
Preloaded with the EFFECT formula from Example 1 — change anything and watch it respond.
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