The Effective Annual Rate is the interest actually earned on your investment as a result of compounding the interest and principal over time. A higher number of compounding periods results in higher EAR.
To compute the daily return rate on your KDI Save investment, you may use the following formula:
Daily Interest Amount=Value of investment × ((1+EAR)^(1⁄365)-1 )
Example 1: For RM10,000 deposited with KDI Save on day one
In Example 1, your savings of RM10,000.00 will compound to RM10,400.00 after one year of daily compounding, providing a return of 4%.
Example 2: For RM500,000 deposited with KDI Save on day one
In Example 2, your savings of RM500,000.00 will compound to RM516,227.60 after one year of daily compounding, providing a return of 3.25%.