How Do You Calculate A Portfolios Rate Of?
It’s important to be able to calculate the rate of return on your investment portfolio. This information is necessary to understand your past investment earnings, get a picture of your current financial status and help you make decisions in the future. Unfortunately, many investors do not understand how to accurately calculate their return on investment for their portfolios, especially when it comes to mixed investments and accounting for deposits and withdrawals. When done correctly, calculating your return on investment is very useful for any investor. Determine your portfolio balance for a set period of time. The best way to calculate your rate of return is annually, since that is how interest rates are calculated and it’s information you should know for your taxes. For each of your investment accounts, look up your balance on the last day of the previous year and then on the first day of the year before that. Write down the dates and amounts of any deposits and withdrawals for each
