Basis Points (BPS)

January 03, 2022

What is a Basis Point?

A basis point represents one gradation on a 100-point scale representing 1%. This term is used especially in expressing variations in the yields of bonds. Fixed income yields vary often and slightly within one percent and the basis point scale easily expresses these changes in hundredths of 1%.

Basis Point Calculator

One basis point is equal to 0.01% or 0.0001. To figure out basis points as a percentage, simply multiply the basis points by 0.01%.

For example, if a stock option is worth $6,000 and increases by 50 basis points, multiply 50 by 0.01% and find the stock has increased by 0.5% or 0.005. Multiply 6,000 by 0.5% or 0.005, to find its value has increased by $30, and is now worth $6,030.

How Much are 20, 50, and 100 Basis Points?

Wealthspire Advisors is a registered investment adviser and subsidiary company of NFP Corp.

This information should not be construed as a recommendation, offer to sell, or solicitation of an offer to buy a particular security or investment strategy. The commentary provided is for informational purposes only and should not be relied upon for accounting, legal, or tax advice. While the information is deemed reliable, Wealthspire Advisors cannot guarantee its accuracy, completeness, or suitability for any purpose, and makes no warranties with regard to the results to be obtained from its use.

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