Best Math Formula website. Search anything about Math Formula in this website.
how to calculate geometric mean rate of return. Where n is number of numbers and X1Xn are the numbers from the first to the n-th. In other words it is the average return of an investment over time a metric used to evaluate the performance of a single investment or an investment portfolio.
Rate Of Return Formula Calculator Excel Template from www.educba.com
An alternative way to write the formula is X1 x X2. Geometricreturn sqrtn 1 r_1 times 1 r_2 times 1 r_3 times. This short video considers the Geometric Mean and in particular presents a calculation of the Geometric Mean Rate of Return for the value of a portfolio over.
7 R a 1 r 1 1 r 2 12 1.
The geometric mean is the average growth of an investment computed by multiplying n variables and then taking the nth root. Where n is number of numbers and X1Xn are the numbers from the first to the n-th. The holding period return is the total return over multiple periods. Geometric mean return is a more complicated method of calculating the average rate but its more accurate than the arithmetic one.
