Afternoon dc

Measuring Investment Performance: Annualised Returns vs Simple Returns:

What’s the right way to look at your portfolio’s performance? Which of the two should you use and when? The last few years have been good for your investment portfolio. Some of your mutual fund investments have done exceedingly well. But knowing that your investment has doubled (i.e. grown 100%) is meaningless unless you know over what period this took place — doubling over 5 years indicates it has grown at a rate of 14.86% a year, doubling over 10 years implies growth of 7.17% a year, while doubling over 15 years means your investment has grown at only 4.73% a year.