Basis Point Calculator
Convert a number of basis points into a percentage, a decimal and the actual dollar amount it represents.
Input Data
Results
At a glance:A basis point (bp) is one hundredth of a percentage point: 1 bp = 0.01% = 0.0001. The Basis Point calculator converts bps into a percentage (bps / 100), a decimal (bps / 10,000) and the actual amount (decimal x base value). Example: 25 bps = 0.25% = 0.0025; on HK$3,000,000 the annual interest impact is about HK$7,500. WARNING: The amount is a simple linear estimate that does not compound monthly declining principal; actual interest also depends on the repayment schedule. Basis points are the standard unit for quoting interest-rate changes in Hong Kong and worldwide.
Formula
Percentage = basis points / 100.
Decimal = basis points / 10,000 (1 bp = 0.01% = 0.0001).
Amount = decimal x base value.
Value after increase = base value + amount; value after decrease = base value - amount.
$$$Percent = \\dfrac{bps}{100}\\%$$\\dfrac{bps}{10000}$$$$$$Impact = \\dfrac{bps}{10000}\\times Base$$$$$$Base + Impact$$Base - Impact$$$How to Use
- Enter the number of basis points (e.g. 25).
- Enter the base amount the change applies to.
- View the percentage, decimal and the resulting dollar amount (and the value after an increase or decrease).
Case Studies
Case 1: The dollar weight of 25 basis points
25 basis points sounds tiny, but on a principal of HK$3,000,000 the annual interest rises by about HK$7,500 (before compounding and monthly principal decline). This shows why every 'rate rise/fall of several basis points' headline from the central bank or banks matters to mortgagors, borrowers and depositors — the larger the principal, the heavier each basis point.
Case 2: Basis-point conversion and two-way impact
Base amount HK$1,000,000, change of 50 basis points. Percentage = 50 / 100 = 0.5%; decimal = 50 / 10,000 = 0.005; dollar impact = 0.005 x 1,000,000 = HK$5,000.
Value after increase = 1,005,000; value after decrease = 995,000. 50 bps equals 0.5%, which on HK$1,000,000 is a HK$5,000 two-way impact. Quoting the move in basis points is precise and unambiguous.
FAQ
What is a basis point?
One basis point (bp) is 0.01% (one hundredth of a percentage point) or 0.0001 as a decimal. It is the standard unit for quoting interest-rate changes so that movements are stated precisely and unambiguously.
Why express rate changes in basis points?
Saying 'rates rose 25 basis points' is clearer than 'rose 0.25 percentage points' or the ambiguous 'rose 5%'. Because basis points are absolute, they avoid the confusion between a relative and an absolute change.
How much does a basis-point move cost in dollars?
Amount = (bps / 10,000) x base value. On HK$1,000,000, a 50 bp move equals 0.5%, or HK$5,000 in either direction. The larger the principal, the heavier each basis point weighs.
Related Tools
References
Content review: Calculatorism Finance Team. Results are for reference only; please refer to the relevant authorities for the official figures.