fvvar

Future value of varying cash flow

Syntax

FutureVal = fvvar(CashFlow, Rate, CFDates)

Arguments

CashFlow

A vector of varying cash flows. Include the initial investment as the initial cash flow value (a negative number).

Rate

Periodic interest rate. Enter as a decimal fraction.

CFDates

(Optional) For irregular (nonperiodic) cash flows, a vector of dates on which the cash flows occur. Enter dates as serial date numbers or date strings. Default assumes CashFlow contains regular (periodic) cash flows.

Description

FutureVal = fvvar(CashFlow, Rate, CFDates) returns the future value of a varying cash flow.

Examples

This cash flow represents the yearly income from an initial investment of $10,000. The annual interest rate is 8%.

Year 1

$2000

Year 2

$1500

Year 3

$3000

Year 4

$3800

Year 5

$5000

For the future value of this regular (periodic) cash flow

FutureVal = fvvar([-10000 2000 1500 3000 3800 5000], 0.08)

returns

FutureVal =

            2520.47

An investment of $10,000 returns this irregular cash flow. The original investment and its date are included. The periodic interest rate is 9%.

Cash Flow

Dates

($10000)

January 12, 2000

$2500

February 14, 2001

$2000

March 3, 2001

$3000

June 14, 2001

$4000

December 1, 2001

To calculate the future value of this irregular (nonperiodic) cash flow

CashFlow = [-10000, 2500, 2000, 3000, 4000];

CFDates = ['01/12/2000'
            '02/14/2001'
            '03/03/2001'
            '06/14/2001'
            '12/01/2001'];

FutureVal = fvvar(CashFlow, 0.09, CFDates)

returns

FutureVal =

            170.66

See Also

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