1. What is Stock Return Calculation?

The stock return calculation measures the percentage change in value of an investment over time. It helps investors evaluate the performance of their investments.

2. How Does the Calculator Work?

The calculator uses the return formula:

Where:

• \( Final Value \) — Current value of investment
• \( Initial Value \) — Original investment amount

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

3. Importance of Return Calculation

Details: Calculating returns helps investors compare performance across different investments, assess portfolio growth, and make informed decisions.

4. Using the Calculator

Tips: Enter the initial investment amount and current value in dollars. Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What does a negative return mean?
A: A negative return indicates a loss on your investment (final value is less than initial value).

Q2: Should I include dividends in final value?
A: For total return calculations, yes - include all dividends received and reinvested.

Q3: How does this differ from annualized return?
A: This calculates simple return. Annualized return accounts for compounding over multiple years.

Q4: What's considered a good return?
A: This varies by market conditions, but historically stocks average 7-10% annual return long-term.

Q5: Can I use this for other investments?
A: Yes, this formula works for any investment where you can measure initial and final values.