How to Calculate Daily APY
- 1). Divide the annual interest rate by 365 to calculate the daily interest rate. For example, if your annual interest rate was 10 percent, you would divide 0.10 by 365 to get 0.000273973.
- 2). Add 1 to the result. In this example, you would add 1 to 0.000273973 to get 1.000273973.
- 3). Raise the result to the 365th power, because when interest is compounded daily there are 365 periods per year. In this example, you would raise 1.000273973 to the 365th power to get 1.105155782.
- 4). Subtract 1 from that result to find the daily APY expressed as a decimal. In this example, you would subtract 1 from 1.105155782 to get 0.105155782.
- 5). Multiply the result by 100 to convert to a percentage and find the daily APY. Finishing the example, you would multiply 100 by 0.105155782 to find that the daily APY is about 10.52 percent.