Recurring Deposit (RD) is a type of investment in which fixed amount is invested on monthly basis in
banks or other
investment companies with fixed rate of interest and tenure. Unlinke SIP this investment scheme
offers trivial
or low risk as it is not bound to any market volatility. In this
scheme at the time of maturity investor is paid back accumulated principal and interest which is
compounded as
applicable by governing bank or investment company.
click on Recurring Deposits to read more about it.
Consider example: Investor wants to invest 5000 on monthly basis in a bank for 2
years with rate of interest as 7.5% pa and bank offers compounding on quarterly
basis.
User has to put 5000 in Monthly investment textbox, 2 in period with years as drop
down selection and 7.5 as rate of interest. Select compounding as
applicable (Quarterly) and click on calculate button.
You can now see total principal that is accumulated over 2 years, maturity value and
total interest
that will be paid after 2 years. On changing any value, new projections as per
latest data are
automatically
calculated.
Compounding is the rate at which earnings from capital, capital gains or interest
are reinvested. Nowadays compounding is on daily or quarterly basis. It can
differ by country, state, investment bank or firm in which investor is investing.
Compounding plays key
role in growing your money. For longer period of time it gives exponential growth to
the invested money and at the end gives handsome earnings.
PDF reports and Amortization Table:
User can download pdf report free of cost for whatever calculations and projections
he has done on current screen. You can click on Download pdf button to download the
report. Pdf report consists of your returns projection,
inputs that has been considered for calculations, pie charts and amortization.
Amortization table shows specific returns projection on corresponding month which
lies
between the tenure entered. By using amortization table user can see projections on
any month just
by navigating to the row of intended month.
Pie Charts:
Pie chart graphically describes the investment scenario. It consists of 2 parts or
regions. 1st region gives idea about total interest
amount that
investor will receive at the end of tenure. 2nd part or region is the
principal that
is accumulated or invested over the tenure. Region 1 and 2 is always equals to maturity
amount. You can click on each region to see the amount and percentage. This pie
chart is also available in pdf report.
Comparison matrix of your returns against various years and returns.