<html>
<body>
<pre>
<script>
function log(arg) {
document.body.innerHTML = document.body.innerHTML + arg + '\n<br>';
}
function clear() {
document.body.innerHTML = '';
}
function parseDate(dateString) {
var mdy = dateString.split('/')
return new Date(mdy[2], mdy[0]-1, mdy[1]);
}
function yearsInBetweenDates(date1, date2) {
return (date2-date1)/(1000*60*60*24*365);
}
function assignYearsInBetween(paymentArray, currentNetWorth) {
for (var i = 0; i<paymentArray.length; i++) {
paymentArray[i].years = yearsInBetweenDates(paymentArray[i].date, currentNetWorth.date);
}
}
function findRateOfReturn(paymentArray, currentNetWorth, lowRate, highRate){
assignYearsInBetween(paymentArray, currentNetWorth);
while(highRate-lowRate > .0001) {
var testRate = (lowRate + highRate)/2;
var calculatedNetWorth = calculateNetWorth(paymentArray, testRate);
if(calculatedNetWorth < currentNetWorth.amount) {
lowRate = testRate;
} else {
highRate = testRate;
}
}
return lowRate;
}
function calculateNetWorth(paymentArray, interestRate) {
var total = 0;
for (var i=0; i<paymentArray.length; i++) {
var P = paymentArray[i].amount;
var r = interestRate;
var y = paymentArray[i].years;
total = total + P*Math.pow((1+r), y);
}
return total;
}
function createTransaction(date, amount) {
var object = new Object();
object.date = parseDate(date);
object.amount = amount;
return object;
}
var currentNetWorth = createTransaction("05/30/2014", 3170.14);
var paymentArray = [];
paymentArray[0] = createTransaction("04/02/2013", 300.00);
paymentArray[1] = createTransaction("05/03/2013", 300.00);
paymentArray[2] = createTransaction("09/03/2013", 300.00);
paymentArray[3] = createTransaction("10/01/2013", 300.00);
paymentArray[4] = createTransaction("11/01/2013", 300.00);
paymentArray[5] = createTransaction("12/01/2013", 300.00);
paymentArray[6] = createTransaction("01/02/2014", 250.00);
paymentArray[7] = createTransaction("02/04/2014", 250.00);
paymentArray[8] = createTransaction("03/04/2014", 250.00);
paymentArray[9] = createTransaction("04/02/2014", 300.00);
paymentArray[10] = createTransaction("05/02/2014", 300.00);
log('Rate:'+findRateOfReturn(paymentArray, currentNetWorth, -1, 1));
</script>
</pre>
</body>
</html>
<body>
<pre>
<script>
function log(arg) {
document.body.innerHTML = document.body.innerHTML + arg + '\n<br>';
}
function clear() {
document.body.innerHTML = '';
}
function parseDate(dateString) {
var mdy = dateString.split('/')
return new Date(mdy[2], mdy[0]-1, mdy[1]);
}
function yearsInBetweenDates(date1, date2) {
return (date2-date1)/(1000*60*60*24*365);
}
function assignYearsInBetween(paymentArray, currentNetWorth) {
for (var i = 0; i<paymentArray.length; i++) {
paymentArray[i].years = yearsInBetweenDates(paymentArray[i].date, currentNetWorth.date);
}
}
function findRateOfReturn(paymentArray, currentNetWorth, lowRate, highRate){
assignYearsInBetween(paymentArray, currentNetWorth);
while(highRate-lowRate > .0001) {
var testRate = (lowRate + highRate)/2;
var calculatedNetWorth = calculateNetWorth(paymentArray, testRate);
if(calculatedNetWorth < currentNetWorth.amount) {
lowRate = testRate;
} else {
highRate = testRate;
}
}
return lowRate;
}
function calculateNetWorth(paymentArray, interestRate) {
var total = 0;
for (var i=0; i<paymentArray.length; i++) {
var P = paymentArray[i].amount;
var r = interestRate;
var y = paymentArray[i].years;
total = total + P*Math.pow((1+r), y);
}
return total;
}
function createTransaction(date, amount) {
var object = new Object();
object.date = parseDate(date);
object.amount = amount;
return object;
}
var currentNetWorth = createTransaction("05/30/2014", 3170.14);
var paymentArray = [];
paymentArray[0] = createTransaction("04/02/2013", 300.00);
paymentArray[1] = createTransaction("05/03/2013", 300.00);
paymentArray[2] = createTransaction("09/03/2013", 300.00);
paymentArray[3] = createTransaction("10/01/2013", 300.00);
paymentArray[4] = createTransaction("11/01/2013", 300.00);
paymentArray[5] = createTransaction("12/01/2013", 300.00);
paymentArray[6] = createTransaction("01/02/2014", 250.00);
paymentArray[7] = createTransaction("02/04/2014", 250.00);
paymentArray[8] = createTransaction("03/04/2014", 250.00);
paymentArray[9] = createTransaction("04/02/2014", 300.00);
paymentArray[10] = createTransaction("05/02/2014", 300.00);
log('Rate:'+findRateOfReturn(paymentArray, currentNetWorth, -1, 1));
</script>
</pre>
</body>
</html>
This program outputs 1.17 as the interest rate.
This post was reposted from http://scottizu.wordpress.com/2014/06/12/an-implementation-in-javascript-of-the-interest-rate-algorithm/, originally written on June 12th, 2014.
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