Basis Points Calculator
One basis point is one hundredth of a percent.
Basis Points Calculator
1 basis point = 0.01 percentage point; value change = balance x bps / 10,000.
Calculated instantly
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What This Calculator Does
The Basis Points Calculator converts a basis point change into a percentage and a dollar amount on a balance or loan. It also shows what one basis point is worth, which makes a rate negotiation easier to price.
How It Works
One basis point is one hundredth of a percentage point, so dividing basis points by 100 gives the percentage change. Dividing by 10,000 and multiplying by the balance gives the dollar change. Adding that change to the balance gives the new value. The one-basis-point result divides the balance by 10,000.
Example
A 75 basis point change on a $250,000 balance is 0.75 percent, or $1,875. The new value is $251,875, and one basis point is worth $25.
Formula
basis points / 100balance x basis points / 10,000balance x (1 + basis points / 10,000)balance / 10,000Reading the Results
Rate change
The basis point change expressed as a percentage. A negative value is a rate cut, and the calculator handles it as a decrease.
Value change
The dollar effect on the full balance for a one-year change, before compounding or amortisation. For a loan, the interest effect declines as principal is repaid.
One basis point is worth
The dollar value of a single basis point on this balance. It is a quick way to price a negotiation or an expense ratio.
Sources and References
US Federal Reserve - Selected Interest Rates (H.15)
Rate changes quoted in basis points
The Fed publishes market rates, and basis points are the standard unit for changes.
US SEC Investor.gov - Interest Rate
Percentage points and rate changes
Investor education on how rate changes affect borrowing and savings.
References identify the method or data behind this calculator. Where a standard or tariff changes, the current edition applies, and the assumptions stated above take precedence over a remembered figure.
Frequently Asked Questions
How many basis points are in one percent?
One hundred. One basis point is 0.01 percent, so 100 bps is 1 percent, 50 bps is 0.5 percent, and 25 bps is 0.25 percent. This is why a 25 bps cut is a quarter of a percentage point, not a quarter of the rate.
Why use basis points instead of percentages?
Basis points are unambiguous. A "0.5 percent cut" could mean half a percentage point or half of the current rate. "50 basis points" always means half a percentage point. They are standard in bond, mortgage, and central bank communication.
Does the dollar change account for amortisation?
No. It applies the rate change to the full balance for a year. On an amortising loan the balance falls, so the interest effect is smaller over time. Use the mortgage or amortisation calculator for a payment-level answer.
Can basis points be negative?
Yes, for a rate cut. Enter a negative number and the calculator shows the percentage decrease, the dollar reduction, and the lower new value. A negative rate itself is unusual but the arithmetic still works.
How do basis points apply to fund fees?
Expense ratios are often quoted in basis points, such as 0.05 percent for an index fund or 1.00 percent for an active fund. On a $100,000 portfolio, 50 bps is $500 a year. The fee compounds against you, so small differences matter over decades.