How do you calculate the annualised rate of return for your investment? and Climate-Investment-Community-Paris 27okt2010-3

How do you calculate the annualised rate of return for your investment?

Example
If an investment increases in valve in 2 years from $ 100 to $ 125, the increase of $ 25 in the 2 years period would represent a cumulative return of 25%. But how would you calculate the annualised rate of return ? What is the formula ?


Investment best answer:

Answer by tvh2k
Was the rate of return consistent throughout the 24-month period? Monthly compounding formula for 24-month period is (1+rate/12)^24.

I think you want the inverse of this to the 12th power:
12 * ( e^ ( ln(1.25) / 24 ) -1 )

Correct me if this is wrong...

Investment

Climate-Investment-Community-Paris 27okt2010-3


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Environmental experts enjoying the reception at the ambassadors residence.

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