APY Formula
APY accounts for the effect of compounding within the year:
APY = (1 + r/n)ⁿ − 1
Where r = nominal annual rate (as a decimal) and n = number of compounding periods per year. The more frequently interest compounds, the higher the effective yield relative to the stated rate.
| Nominal Rate | Daily APY | Monthly APY | Quarterly APY | Annual APY |
|---|---|---|---|---|
| 1.00% | 1.005% | 1.005% | 1.004% | 1.000% |
| 3.00% | 3.045% | 3.042% | 3.034% | 3.000% |
| 5.00% | 5.127% | 5.116% | 5.095% | 5.000% |
| 7.00% | 7.250% | 7.229% | 7.186% | 7.000% |
| 10.00% | 10.516% | 10.471% | 10.381% | 10.000% |