Convert total return to per-year return. The Annualized Return Calculator takes total return over the period, holding period and returns annualized return plus growth multiple. Results update as you type, and the formula is shown under the result so you can repeat it in your own spreadsheet.
Investment maths is about comparing money at different points in time on a fair basis. Compound rates, discounting and annualised returns let you compare options of different sizes and durations. Use the worked example below to check the maths against your own figures.
How the Annualized Return Calculator works
Converting a total return to a yearly compound rate lets you compare investments held for different lengths of time. 35% over two years is 16.2% a year, not 17.5%.
Worked example
With the example values (total return over the period of 35%, holding period of 2 years), the annualized return is 16.19%; growth multiple 1.35x. Change any figure above and the result updates immediately; use Copy results to paste the summary into a note or email.
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Frequently Asked Questions
How is annualized return calculated?
annualized return = (1 + total return)1/years − 1.
Which figures do I need?
Total return over the period, holding period. Take them from the same period and the same set of accounts or reports so the ratio is consistent, and check the example values as a guide to the units expected.
Does the calculator account for taxes and fees?
Only where there is an input for them. For a true net return, add fees and taxes to your inputs or use the stock and crypto profit calculators, which include them.
