Easy Explanation Notes with Examples

TBILLYIELD function in Excel

What is the T-Bill?

T-Bill is an acronym of Treasury bill, which is a short term debt instrument, issued (at discount) by the central government and pays no interest. The difference between the issue price and the redemption price (or maturity value) is the yield of the security. The funds raised through the T-bill are utilized by the government for various public projects like construction of roads etc.

Use of the TBILLYIELD function

In Excel, the TBILLYIELD function calculates the yield for a Treasury bill. It is a Financial function.

Syntax

TBILLYIELD(settlement, maturity, pr)

The TBILLYIELD has the following arguments:

settlement – Required. The date on which the treasury bill will be purchased by an investor.

maturity – Required. The date on which the treasury bill will expire.

pr – Required. The price of the treasury bill.

Example

Suppose, you purchased a $100 face value treasury bill for $97 on February 01, 2020. The bill redeemed on September 15, 2020, for $100. The yield of the bill will be calculated as under:

The T-bill with the above terms has the yield of 4.9%.

Function Errors

Error Occurs
#VALUE! If the supplied settlement/ maturity date is invalid.
If any supplied argument is non-numeric.
#NUM! If the supplied price is equal or less than zero.
If the settlement date is equal or after the maturity date.




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