Compounded

Subtype of Compounding

The earned interest amount should be capitalized over time according to a mathematical formula described below.
Formally, the interest amount I earned during any time period with length t is given by the formula I = N(1+r/f)ᶠᵗ - N
where:
N is the notional at the begining of the accrual period
r is the applicable fixed rate
t is the length of the accrual period in number of years according to some given DayCount convention.
f is the compounding frequency of the applicable fixed rate, e.g. 2 if semiannual.

Note, this setting is not compatible with the frequencies Once or None