Re: ROI (btw) always annualizing

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Posted by Mark on January 10, 2007 at 12:24:34:

In Reply to: Re: ROI (btw) always annualizing posted by Corey on January 10, 2007 at 10:56:43:

: Mark,

: I just used that one investment as an example. But it seems that all investments are acting this way (not just 1 or 2).

: If you run a report for a calendar year, all investments held less than a year will show significantly higher Roi (btw) than Roi (end).

: I was under the impression that if an investment was held for less than a year and the report was for that year period, then the Roi (btw) and Roi (end) would be the same (annualized yields unchecked).

: In fact, checking and unchecking the "Annualized yields" option will cause Roi (end) to change from an unannualized to an annualized. But Roi (btw) will always remain annualized.

: If your reports do not do this, then maybe my program got corrupted or I have some option toggled wrong?

: Thanks.

Hi Corey,

The "ROI (end)" field is going from the date of your first transaction, up through the ending report date. The "ROI (btw)" is going from the starting report date to the ending report date. Since your report date range is for 1 year, the ROI (btw) will always be the same whether you are annualizing or not. It is already the yield for 1 year.

I suspect the ROI (end) is actually for a yield term much less than one year, since the ROI (btw) is so much larger than ROI (end). If you owned a stock for the last month of the year, and it made 7.4% in that one month, the annualized yield for 1 year would be much larger (roughly 7.4% times 12 months).

When did you first buy the stocks in question? Would this explain the difference between the 2 yields?

Thanks,
Mark
--
Fund Manager - Portfolio Management Software

Replies:

• Re: ROI (btw) always annualizing Corey 12:56:00 01/10/07 (1)
  • Re: ROI (btw) always annualizing Mark 13:08:38 01/10/07 (0)