Learn more about Financial Toolbox

Introduction

Financial Toolbox software contains functions that perform many common financial tasks, including:

• Handling and Converting Dates

  Calendar functions convert dates among different formats (including Excel^® formats), determine future or past dates, find dates of holidays and business days, compute time differences between dates, find coupon dates and coupon periods for coupon bonds, and compute time periods based on 360-, 365-, or 366-day years.

• Formatting Currency

  The toolbox includes functions for handling decimal values in bank (currency) formats and as fractional prices.

• Charting Financial Data

  Charting functions produce a variety of financial charts including Bollinger bands, high-low-close charts, candlestick plots, point and figure plots, and moving-average plots.

• Analyzing and Computing Cash Flows

  Cash-flow evaluation and financial accounting functions compute interest rates, rates of return, payments associated with loans and annuities, future and present values, depreciation, and other standard accounting calculations associated with cash-flow streams.

• Pricing and Computing Yields for Fixed-Income Securities

  Securities Industry Association (SIA) compliant fixed-income functions compute prices, yields, accrued interest, and sensitivities for securities such as bonds, zero-coupon bonds, and Treasury bills. They handle odd first and last periods in price/yield calculations, compute accrued interest and discount rates, and calculate convexity and duration. Another set of functions analyzes term structure of interest rates, including pricing bonds from yield curves and bootstrapping yield curves from market prices.

• Pricing and Analyzing Equity Derivatives

  Derivatives analysis functions compute prices, yields, and sensitivities for derivative securities. They deal with both European and American options.

  Black-Scholes functions work with European options. They compute delta, gamma, lambda, rho, theta, and vega, as well as values of call and put options.

  Binomial functions work with American options, computing put and call prices.

• Analyzing Portfolios

  Portfolio analysis functions provide basic utilities to compute variances and covariance of portfolios, find combinations to minimize variance, compute Markowitz efficient frontiers, and calculate combined rates of return.

• Modeling volatility in time series.

  Generalized Autoregressive Conditional Heteroskedasticity (GARCH) functions model the volatility of univariate economic time series. (Econometrics Toolbox™ software provides a more comprehensive and integrated computing environment. For information, see the Econometrics Toolbox User's Guide documentation or the financial products Web page at http://www.mathworks.com/products/finprod.)

Performing Common Financial Tasks

Handling and Converting Dates

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