Financial Modeling Tutorials

- Financial Modeling Basics
- Excel Modeling
- Financial Functions in Excel
- Sensitivity Analysis in Excel
- Sensitivity Analysis
- Capital Budgeting Techniques
- Time Value of Money
- Future Value Formula
- Present Value Factor
- Perpetuity Formula
- Present Value vs Future Value
- Annuity vs Pension
- Present Value of an Annuity
- Doubling Time Formula
- Annuity Formula
- Annuity vs Perpetuity
- Annuity vs Lump Sum
- Deferred Annuity Formula
- Internal Rate of Return (IRR)
- IRR Examples (Internal Rate of Return)
- NPV vs XNPV
- NPV vs IRR
- NPV Formula
- NPV Profile
- NPV Examples
- PV vs NPV
- IRR vs ROI
- Break Even Point
- Payback Period & Discounted Payback Period
- Payback period Formula
- Discounted Payback Period Formula
- Profitability Index
- Cash Burn Rate
- Simple Interest
- Simple Interest vs Compound Interest
- Simple Interest Formula
- CAGR Formula (Compounded Annual Growth Rate)
- Effective Interest Rate
- Loan Amortization Schedule
- Mortgage Formula
- Loan Principal Amount
- Interest Rate Formula
- Rate of Return Formula
- Effective Annual Rate
- Effective Annual Rate Formula (EAR)
- Daily Compound Interest
- Monthly Compound Interest Formula
- Discount Rate vs Interest Rate
- Rule of 72
- Geometric Mean Return
- Real Rate of Return Formula
- Continuous compounding Formula
- Weighted average Formula
- Average Formula
- Average Rate of Return Formula
- Mean Formula
- Mean Examples
- Population Mean Formula
- Weighted Mean Formula
- Harmonic Mean Formula
- Median Formula in Statistics
- Range Formula
- Outlier Formula
- Decile Formula
- Midrange Formula
- Quartile Deviation
- Expected Value Formula
- Exponential Growth Formula
- Margin of Error Formula
- Decrease Percentage Formula
- Percent Error Formula
- Holding Period Return Formula
- Cost Benefit Analysis
- Cost Benefit Analysis Examples
- Cost Volume Profit Analysis
- Opportunity Cost Formula
- Opportunity Cost Examples
- Mortgage APR vs Interest Rate
- Normal Distribution Formula
- Standard Normal Distribution Formula
- Normalization Formula
- Bell Curve
- T Distribution Formula
- Regression Formula
- Regression Analysis Formula
- Multiple Regression Formula
- Correlation Coefficient Formula
- Correlation Formula
- Population Variance Formula
- Covariance Formula
- Coefficient of Variation Formula
- Sample Standard Deviation Formula
- Relative Standard Deviation Formula
- Standard Deviation Formula
- Volatility Formula
- Binomial Distribution Formula
- Quartile Formula
- P Value Formula
- Skewness Formula
- R Squared Formula
- Adjusted R Squared
- Regression vs ANOVA
- Z Test Formula
- F-Test Formula
- Quantitative Research

Related Courses

**Formula of Decile (Table of Contents)**

## What is Decile Formula?

In descriptive statistics, the term “decile” refers to the nine values that split the population data into ten equal fragments such that each fragment is representative of 1/10^{th} of the population. In other words, each successive decile corresponds to an increase of 10% points such that the 1st decile or D_{1} has 10% of the observations below it, then 2^{nd} decile or D_{2} has 20% of the observations below it and so on so forth. There are several formulae in vogue to calculate decile, and this method is one of the simplest one where each decile is calculated by adding one to the number of data in the population, then divide the sum by 10 and then finally multiply the result by the rank of the decile i.e. 1 for D_{1}, 2 for D_{2}… 9 for D_{9}.

Mathematically, each decile is represented as,

**1 ^{st} decile, D_{1} = 1 * (n + 1) / 10 th data**

**2 ^{nd} decile, D_{2} = 2 * (n + 1) / 10 th data**

**3 ^{rd} decile, D_{3} = 3 * (n + 1) / 10 th data**

**……………………………………**

**9 ^{th} decile, D_{9} = 9 * (n + 1) / 10 th data**

where n = Number of data in the population or sample

The formula for the i^{th} decile can be represented as,

**D**

_{i}= i * (n + 1) / 10 th data### Explanation of the Decile Formula

The formula for calculation of decile is derived by using the following steps:

**Step 1:** Firstly, determine the number of data or variables in the population or sample which is denoted by n.

**Step 2:** Next, sort the all data or variables in the population in ascending order.

**Step 3:** Next, based on the decile that is required, determine the value by adding one to the number of data in the population, then divide the sum by 10 and then finally multiply the result by the rank of the decile as shown below.

**i ^{th} decile, D_{i} formula = i * (n + 1) / 10 th data**

**Step 4:** Finally, on the basis of the decile value figure out the corresponding variable from among the data in the population.

### Example of Decile Formula (with Excel Template)

**Let us suppose that John has been given a set of unsorted data points. He has been asked to sort the number and cut them into 10 equal sections. So, help John do the task of sorting the following 23 random numbers valued from 20 to 78 and presenting then as deciles. The raw numbers are:24, 32, 27, 32, 23, 62, 45, 77, 60, 63, 36, 54, 57, 36, 72, 55, 51, 32, 56, 33, 42, 55, 30.**

4.9 (927 ratings)

Given,

- n = 23

Firstly, sort the 23 random numbers in the ascending order like below,

23, 24, 27, 30, 32, 32, 32, 33, 36, 36, 42, 45, 51, 54, 55, 55, 56, 57, 60, 62, 63, 72, 77

So, the calculation of decile^{ }can be done as follows-

Similarly, we can calculate each decile as shown above,

Now, D_{1} = 1 * (n + 1) / 10 th data = 1 * (23 + 1) / 10

= 2.4^{th} data i.e. between digit no. 2 and 3

which is = 24 + 0.4 * (27 – 24) = 25.2

Again, D_{2} = 2 * (23 + 1) / 10 th data

= 4.8^{th} data i.e. between digit no. 4 and 5

which is = 30 + 0.8 * (32 – 30) = 31.6

Again, D_{3} = 3 * (23 + 1) / 10 th data

= 7.2^{th} data i.e. between digit no. 7 and 8

which is = 32 + 0.2 * (33 – 32) = 32.2

Again, D_{4} = 4 * (23 + 1) / 10 th data

= 9.6^{th} data i.e. between digit no. 9 and 10

which is = 36 + 0.6 * (36 – 36) = 36

Again, D_{5} = 5 * (23 + 1) / 10 th data

= 12^{th} data i.e. digit no. 12

which is 45

Again, D_{6} = 6 * (23 + 1) / 10 th data

= 14.4^{th} data i.e. between digit no. 14 and 15

which is = 54 + 0.4 * (55 – 54) = 54.4

Again, D_{7} = 7 * (23 + 1) / 10 th data

= 16.8^{th} data i.e. between digit no. 16 and 17

which is = 55 + 0.8 * (56 – 55) = 55.8

Again, D_{8} = 8 * (23 + 1) / 10 th data

= 19.2^{th} data i.e. between digit no. 19 and 20

which is = 60 + 0.2 * (62 – 60) = 60.4

Again, D_{9} = 9 * (23 + 1) / 10 th data

= 21.6^{th} data i.e. between digit no. 21 and 22

which is = 63 + 0.6 * (72 – 63) = 68.4

**Decile will be –**

Therefore, the deciles value are as follows –

**D1 =25.2**

### Relevance and Uses

It is very important to understand the concept of decile because it is widely used in the field of portfolio management to assess the performance of a portfolio. The decile ranking helps to compare the performance of an asset with other similar assets. decile The decile method is also used by the government to determine the income distribution or level of income equality in a nation. This method of dividing data is used as part of many statistical and academic studies in the fields of economics and finance.

You can download this Decile Formula Excel Template from here – Decile Formula Excel Template

### Recommended Articles

This has been a guide to Decile Formula. Here we will learn how to calculate deciles along with some practical examples in Excel and downloadable excel template. You can learn more about financial analysis from the following articles –

- Random Numbers in VBA Excel
- 10 Best Types of Financial Analysis
- 15 Financial Analysis Techniques
- 4 Financial Analysis Tools
- Median Formula in Statistics
- Formula of Percentile Rank
- Formula of Standard Normal Distribution
- Calculate Quartile Deviation

- 35+ Courses
- 120+ Hours of Videos
- Full Lifetime Access
- Certificate of Completion

- Basic Excel Training
- Advanced Excel Training
- Basic & Advanced VBA Course
- Excel Dashboard Course
- Data Analysis in Excel
- Create VBA Applications