StockFetcher Forums · General Discussion · Formula please<< >>Post Follow-up
SAFeTRADE
414 posts
msg #70271
Ignore SAFeTRADE
12/31/2008 5:23:28 PM

Assuming a 1.25 percent daily increase in a portfolio, what would the rate of return be annually.
What is the excell formula to figure this. Anyone.

Thanks

stocktrader
293 posts
msg #70273
Ignore stocktrader
modified
12/31/2008 9:37:50 PM

This seems like a mixing of apples and oranges to get a lemon.

This would be an "annual" compounded interest rate of 14.9% based on 250 trading days
Assuming $100,000 at start of year with 1.25% daily compounded increase, future value is $222,700 (+123%)

=100000*((1+((14.9/100)/250))^(250*(250/12)))

SAFeTRADE
414 posts
msg #70274
Ignore SAFeTRADE
12/31/2008 9:49:19 PM

Thanks you, I appreciate it very much.

SAFe

stocktrader
293 posts
msg #70275
Ignore stocktrader
12/31/2008 9:58:32 PM

Welcome, but I think I just noticed an error in the formula......

stocktrader
293 posts
msg #70277
Ignore stocktrader
modified
12/31/2008 10:10:44 PM

This is better:

Assuming $100,000 at start of year with 1.25% daily compounded increase, future value is $2,221,331 (+2132%)

=100000*((1+((312/100)/250))^(250*(250/250)))

The 312 is divided by 250 to get 1.25%
I know this formula could be reduced, but I hacked one of my other formulas.
This is basic time value of money (TVM).



SAFeTRADE
414 posts
msg #70281
Ignore SAFeTRADE
1/1/2009 9:55:16 AM

Thanks again stocktrader, excellent.

safetrade

gmatt539
2 posts
msg #70297
Ignore gmatt539
modified
1/1/2009 3:46:04 PM

For future reference

The formula for compounding : FV = PV * (1 + r) ^ t

PV= present value; r = interest rate ; t = time

so assuming r = .0125 and t = 250

$1 will grow to $22.32 in one year (250 trading days at 1.25% per day)

formula in excel =1*(1 +.0125)^250

traderseb
36 posts
msg #70336
Ignore traderseb
1/2/2009 2:37:37 PM

More better might be:

r = interest rate per period

t = periods

SAFeTRADE
414 posts
msg #70337
Ignore SAFeTRADE
1/2/2009 2:39:59 PM

Thanks to all, greatly appreciated.

safetrade

StockFetcher Forums · General Discussion · Formula please<< >>Post Follow-up

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