Average Annual Return	8.98%
Total Return	35.42%
Total Gain/Loss	$ 5,100
Investment Period	3.5 years
Total Deposits	$ 8,800
Total Withdrawals	$ 1,500

Average Return Calculator

Calculating your investment's average return helps you understand how your portfolio has performed over time. Our Average Return Calculator takes into account deposits, withdrawals, and the time value of money to give you an accurate picture of your investment performance.

How Does the Calculator Work?

The calculator uses the Time-Weighted Return (TWR) method, which is considered the gold standard for measuring investment performance because it eliminates the impact of cash flows that are outside the investor's control.

Key Features:

Time-Weighted Returns: Accounts for the timing of deposits and withdrawals

Multiple Transactions: Add unlimited deposits and withdrawals with specific dates

Annualized Returns: Shows your average annual return percentage

Benchmark Comparison: Compare your performance against market benchmarks

Risk Metrics: Calculate volatility and Sharpe ratio for risk assessment

How to Use the Calculator:

Enter your Starting Balance and Ending Balance

Set the Start Date and End Date for your investment period

Add any Deposits or Withdrawals with their specific dates

Optionally compare against a benchmark return

Review your average annual return and performance metrics

Understanding Your Results:

Average Annual Return: This is your annualized rate of return, showing what your investment earned on average each year.

Total Return: The total percentage gain or loss over the entire investment period.

Sharpe Ratio: A measure of risk-adjusted return. Higher values indicate better risk-adjusted performance.

Volatility: Measures how much your returns varied from the average. Lower volatility indicates more stable returns.

Why Track Your Investment Returns?

Performance Evaluation: Understand if your investments are meeting your goals

Strategy Assessment: Determine which investment strategies work best for you

Tax Planning: Better understand your gains and losses for tax purposes

Portfolio Optimization: Identify which investments are performing well or poorly

Tips for Better Investment Tracking:

Keep detailed records of all transactions including dates and amounts

Consider the impact of fees and taxes on your actual returns

Compare your returns to relevant benchmarks like the S&P 500

Look at both absolute returns and risk-adjusted returns

Track performance over multiple time periods

Start tracking your investment performance today with our Average Return Calculator. Understanding your returns is the first step toward making better investment decisions.

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