Yearly Rate Of Return Method

Dictionary Says

Definition of 'Yearly Rate Of Return Method '

More commonly referred to as annual percentage rate. It is the interest rate earned on a fund throughout an entire year. The yearly rate of return is calculated by taking the amount of money gained or lost at the end of the year and dividing it by the initial investment at the beginning of the year. This method is also referred to as the annual rate of return or the nominal annual rate.  

 

Investopedia Says

Investopedia explains 'Yearly Rate Of Return Method '

Calculated by:

Yearly Rate of Return = End of the year value - beginning of the year value
                                                      beginning of the year value

The yearly rate of return method give the owners an idea of how their investment in the company is doing year over year.

Sign Up For Term of the Day!

Try Our Stock Simulator!

Test your trading skills!

Related Definitions

  1. Rate Of Return

    The gain or loss ...
  2. Risk-Free Rate Of Return

    The theoretical ...
  3. Internal Rate Of Return - IRR

    The discount ...
  4. Pretax Rate Of Return

    The rate of ...
  5. Annual Percentage Rate - APR

    The annual rate ...
  6. Yearly Renewable Term - YRT

    A one-year term ...
  7. Operating Income

    The amount of ...
  8. Risk

    The chance that ...
  9. Earnings Before Interest & Tax - EBIT

    An indicator of ...
  10. Inventory Turnover

    A ratio showing ...

Articles Of Interest

  1. Introduction To Inflation-Protected Securities

    Inflation is an enemy to investors - except to those who invest in IPS, which guarantee a real rate of return with no credit risk.
  2. Internal Rate Of Return: An Inside Look

    Use this method to choose which project or investment is right for you.
  3. Gauge Portfolio Performance By Measuring Returns

    Calculate returns frequently and accurately to ensure that you're meeting your investing goals.
  4. How To Calculate Required Rate Of Return

    The required rate of return is used by investors and corporations to evaluate investments. Find out how to calculate it.
  5. Understanding The Time Value Of Money

    Find out why time really is money by learning to calculate present and future value.
  6. Overcoming Compounding's Dark Side

    Understanding how money is made and lost over time can help you improve your returns.
  7. Finding Undiscovered Stocks

    Wall Street tends to focus on large cap stocks, leaving other stocks under-followed and undervalued.
  8. Tips For Controlling Investment Losses

    A profit/loss plan helps investors recognize mistakes and invest logically, rather than emotionally.
  9. How To Find P/E And PEG Ratios

    If these numbers have you in the dark, these easy calculations should help light the way.
  10. How To Make A Winning Long-Term Stock Pick

    Discover the key elements of a good long-term investment and how to find them.

comments powered by Disqus
Recommended
Loading, please wait...
Trading Center