Rates

Interest rate primitives — compounding, discounting, log returns, APR↔APY conversions, and closed-form / iterative yield calculations. Built on top of DeFiMath's exp, ln, expm1, and log1p.

Contract: Rates.sol

Functions

Conventions

• Continuous compounding throughout. All rate inputs are interpreted as continuous APRs unless the function name says otherwise.
• principal, futureValue, price — uint128, 18-decimal fixed-point (1e18 = 1.0).
• rate, apr, apy — annualized as 18-decimal fixed-point. APR/APY conversions take int256 (signed).
• timeInterval, timeToMaturity — uint32, seconds.
• internalRateOfReturn takes parallel cashflows[] and times[] arrays plus an initial guess for Newton-Raphson.
• All functions are internal pure.

Quick example

import "defimath-lib/contracts/finance/Rates.sol";

// Continuous compounding: how much does principal grow in 1 year at 5%?
uint256 fv = DeFiMathRates.compoundInterest(1_000e18, 0.05e18, 365 days);

// Discount a future cashflow back to today.
uint256 pv = DeFiMathRates.presentValue(fv, 0.05e18, 365 days);

// Convert continuous APR (5%) to effective APY.
int256 apy = DeFiMathRates.continuousToDiscrete(int256(0.05e18));

Important notes

• compoundInterest and presentValue are exact inverses. Round-tripping a value through both reconstructs the original up to the underlying exp precision (~5e-14).
• APR ↔ APY both use precision-preserving primitives. continuousToDiscrete uses expm1; discreteToContinuous uses log1p. Safe to call with small rates without precision loss.
• yieldToMaturity is closed-form and cheap; internalRateOfReturn is iterative. Use YTM for zero-coupon bonds (a single ln). Use IRR for arbitrary cashflow schedules — but expect 17k–49k gas depending on cashflow count, and supply a reasonable guess to stay within the iteration budget.
• IRR can fail to converge. Pathological cashflow sets (no real IRR, or multiple sign changes) revert with NoConvergenceError. The solver caps at 50 Newton-Raphson iterations.

Limits & errors