Investor Glossary-apyInvestor Glossary-apyInvestor Glossary-apyInvestor Glossary-apyInsightful stock market charts - Click here
investor
Categories    # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

APY

The HTML to link to this page
 

APY is short for annual percentage yield. The APY is the actual rate of interest paid, or earned, during a year, with compounding. APY is in contrast to APR, or annual percentage rate, that is usually advertised. For example, a bank advertising a 3-month CD with an APR of 5.00% would have an APY that's higher, due to compounding. If the 3-month CD were rolled over four times in the year, the APY would equal 5.00% divided by 4 and then compounded over 4 periods, which would equate to an APY of 5.09% (1.0125^4-1=5.09%). So if you purchased a CD with an APY of 5.09%, on January 1st for $10,000 and rolled it over 4 times, your balance at the end of the year will be $10,509.45, not $10,500.00.



Rate this APY definition...

Learn about investing with the Investor Glossary Term of the Day


Click here for insightful stock market charts. Where is the market headed? The answer may surprise you. Find out
with the exclusive & Barron's recommended charts of Chart of the Day.


Popular Terms: ex-dividend, debt service coverage, required rate of return, annual return, FTSE, margin rate, 1035 exchange, Key Rate Duration, FICO score, inflation, quality assurance, option premium, 1031 exchange, current ratio, minority interest, wholly-owned subsidiary, average price per share, phantom income, VIX, EBITDA, in escrow, risk management, diluted share, deferred tax, ex-dividend date, reverse mortgage, deferred revenue, cancelled check, real GDP, per diem, command economy, stock split, stock market close, Zero Cost Collar, dividends payable, class C shares, retained earnings, balance sheet, labor relations, liquidity ratio, APR, 144a, open position, covered put, implied volatility, limit order, 401a, LIBOR, irrevocable trust


Accounting | Banking | Bonds | Brokers | Economy | Futures | Mutual Funds | Options | Real Estate | Retirement | Stocks | Taxes | Technical Analysis
Home | Term of the Day | Suggest a Term | Chart of the Day | Dogs of the Dow
©2004-2016 Investor Glossary - All rights reserved - Terms of Use