1. What is Investment Return?

Investment return measures the performance of an investment by calculating the percentage change in value from the initial amount to the ending amount over a specific period.

2. How Does the Calculator Work?

The calculator uses the return formula:

Where:

• End Value — Current or final value of the investment
• Start Value — Initial investment amount

Explanation: The formula calculates the percentage gain or loss relative to the original investment amount.

3. Importance of Return Calculation

Details: Calculating investment returns helps investors evaluate performance, compare different investments, and make informed decisions about portfolio allocation.

4. Using the Calculator

Tips: Enter the initial investment amount and current value in dollars. The calculator will show the percentage return (positive for gains, negative for losses).

5. Frequently Asked Questions (FAQ)

Q1: What's considered a good investment return?
A: This depends on the asset class and time period. Historically, stocks average 7-10% annually, while bonds average 3-5%.

Q2: Does this calculator account for time periods?
A: No, this calculates simple return. For annualized returns over multiple years, use the compound return formula.

Q3: Should I include dividends in the end value?
A: Yes, for total return calculations, include all cash flows like dividends and interest.

Q4: What if my start value was zero?
A: The calculation becomes undefined (division by zero). You need a positive initial investment.

Q5: How does this differ from ROI?
A: This is essentially the same as Return on Investment (ROI), just expressed as a percentage.