## About This Tool

The online APY Calculator is used to calculate the annual percentage yield (APY).

## APY Definition

Annual percentage yield (APY) is a normalized representation of an interest rate, based on a compounding period of one year.

## Formula

The annual percentage yield calculation formula is as following:

APY = (1 + r/n)^{n} - 1

Where:

r = stated annual interest rate (nominal interest rate)

n = number of compounding periods per year