What is 'Annualize'
To annualize is to convert a rate of any length into a rate that reflects the rate on an annual (yearly) basis. This is most often done on rates of less than one year, and usually does not take into account the effects of compounding. The annualized rate is not a guarantee but only an estimate, and its accuracy depends on the variance of the rate. This rate is also known as "annualized return" and is similar to "run rate".
2. To convert a taxation period of less than one year to an annual (yearly) basis. This helps income earners to set out an effective tax plan and manage any tax implications.
BREAKING DOWN 'Annualize'
1. For example, a security that returns 1% a month returns 12% on an annualized basis. If, however, the 12% value was computed after only one month of returns, it is not certain that the 12% will be achieved for the year.
2. For example if after the first three months of the year you earn $10,000, you simply multiply the $10,000 by four to achieve $40,000, your annualized income.

Effective Annual Interest Rate
Effective Annual Interest Rate is an investment's annual rate ... 
Annualized Rate
A rate of return for a given period that is less than one year, ... 
Stated Annual Interest Rate
The return on an investment that is expressed as a peryear percentage, ... 
Compound Return
The rate of return, usually expressed as a percentage, that represents ... 
Annual Basis
The return earned by an investment over the course of a year. ... 
Periodic Interest Rate
The interest rate charged on a loan or realized on an investment ...

Investing
The Effective Annual Interest Rate
The effective annual interest rate is a way of restating the annual interest rate so that it takes into account the effects of compounding. 
Professionals
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An investor who is evaluating the performance of a portfolio manager must take into consideration the impact that any contributions or withdrawals made by the investor will have on the overall ... 
Bonds & Fixed Income
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Investopedia explains the natural log and exponential functions used to calculate this value. 
Term
What's a Real Rate of Return?
A real rate of return is an annual percentage investment return thatâ€™s adjusted for inflation, taxes or other factors. 
Fundamental Analysis
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How much are your investments actually returning? Find out why the method of calculation matters. 
Investing
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A quick way to understand the impact of compound interest is to ask yourself if youâ€™d rather receive $100,000 a day for a month, or start with a penny on day one and double it every day for those ... 
Fundamental Analysis
Explaining Annual Returns
Annual return is the standard percentage rate for most investments and credit facilities. 
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Compound Annual Growth Rate (CAGR)
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Professionals
Introduction
FINRA/NASAA Series 66: Section 2 Measuring Portfolio Returns. This section discusses different return measures: return on investment, holding period, annualized, risk free and total returns. 
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Banks use these rates to entice borrowers and investors. Find out what you're really getting.

What is the difference between stated annual return and effective annual return?
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What is the rationale behind the effective interest rate?
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