Average Return Calculator
Find the cumulative and annualized (compound) average return of a series of holding-period returns.
Change the values and press Calculate to work out your own figures.
Add a row for each holding period's return and length.
Show the working
- cumulative = Π (1 + r) − 1
- average = (1 + cumulative)^(1 ÷ years) − 1
How to use it
Add a row for each holding period's return and length.
Enter amounts without commas or with them; rates are percentages (5 for 5%). Negative amounts are allowed where a sign means money paid out.
Key facts
cumulative = Π (1 + rᵢ) − 1; average annual = (1 + cumulative)^(1 ÷ total years) − 1
Arithmetic vs compound
The arithmetic mean of +50% and −50% is 0%, but $100 becomes $75: the compound average (−13.4% a year) tells you what happened.
Questions
What is the average of +10%, −5% and +20% over 2 years?
5.8216% a year over 4 years (25.4% in all).
Formulas
cumulative = Π (1 + rᵢ) − 1; average annual = (1 + cumulative)^(1 ÷ total years) − 1
Sources
Limitations
- Results are estimates for planning, not offers or financial advice; lenders and banks may round, count days or time payments differently.
- Rates are nominal annual rates compounded as you choose; payments at a different frequency use the equivalent periodic rate.