SAFeTRADE 313 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 313 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 313 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 313 posts msg #70337  Ignore SAFeTRADE 
1/2/2009 2:39:59 PM
Thanks to all, greatly appreciated.
safetrade
