Forum Discussion
Weighted average maturity
Hi ssstaud ，
The following article is related to weighted average, you can refer to it and hope it can give you ideas.
Sadly this does not help as this graph deals with dynamic time. I will try to depict my problem better this time.
What are the important values here:
mature_at: the time when our company has to pay the money back to the client
amount: how much money we have to pay back (i.e. the weight)
The calculation logic is better described by this:
How it works: Lets say that in may 2016 a person bought a bond that matures in 5 yrs for the amount of $100. So WAM is for may 5 yrs. For June 2016 it is 4 yrs 11 months.
In July sb. bought a bond of the same value of $100 that also matures in 5 yrs. So for July 2016 the WAM is 4 yrs 11 months, because:
And the graph should look like this (eventually ending in a zero, because all the bonds matured i.e. the money was given back to the client)
Thank you once again for helping me!