Inv. Return Calculator
Quick Example to see what Inv.Return Does: Enter 100 as Purchase Price, Enter 200 as Sale Price (doubled your money). Spin the Year column on the Date Picker back 8 years (if it’s 2009, back to 2001; if it’s 2010, back to 2002). Leave Sale Date alone; it will default to the current date. Tap Compute Return. You should see a return of 8.6624%. Now go input some of your investments!
What it Does: Inv. Return takes a buy date, a buy price, and a sell date and a sell price and calculates the annual return, compounded daily, that you received for that investment. Investment Return calculates your holding period to the day, including days for leap years. Using a non-dividend paying stock as an example, suppose you bought goog (Google) for $188 on 12/20/2004 and sold it for $638 on 1/7/2008. (real-life example) Your annual return on the goog investment was 40.0846% compounded daily. There are other investments like Portfolio Returns and Raw Land real estate investments you can use Investment Return for and they are discussed on our web site. A description of the Inputs required and the Output of Inv. Return is included below.
Inputs:
Purchase Date: When Inv. Return comes up it is set to accept the Purchase Date for your investment. This is the date you bought the investment. Spin the Date Picker columns to select the date you bought your investment. Tip – if you see the value you want for one of the Date Picker columns, just touch that value and it will move up to the selection row. You will see the date you select in the Purchase Date field as well as on the Date Picker.
Sale Date: Tap the Sale Date field to set the Sale Date. The Date Picker at the bottom of the screen will now set the Sale Date field. Input the date you sold your investment. Instructions for setting the Sale Date are the same as for Purchase Date. If you don’t set a Sale Date, Inv. Return will default to use today’s date as the Sale Date. The Sale Date is not allowed to be equal or less than the Purchase Date.
Purchase Price: Tap the Purchase Price field to set your Purchase Price. A numeric input screen will come up to select your Purchase Price. You can either input the Purchase Price of one share you bought or the Purchase Price for all the shares you bought. Zero (0) is not allowed as a Purchase Price, so use .0001 or smaller for the Purchase Price if you have a zero buy price. A valid purchase price is numbers, one decimal point, and nothing else (no special characters). For mathematical reasons, a negative purchase price is not allowed. Input your Purchase Price on the numeric input screen and tap “Done”.
Sale Price: Tap the Sale Price field to set your Sale Price. Instructions are the same as for Purchase Price above. Sale Price is not allowed to be zero or negative for mathematical reasons, so input .0001 or smaller if you have a zero sale price. If you use the 1 Share approach for prices, you need to account for splits to input your Sale Price. If there were no splits, just input the sale price of your stock. If there was one 2-for-1 split while you held your stock, multiply the price you sold your stock for by 2 and input that to Inv. Return. If there were two 2-for-1 splits while you held your stock, multiply the price you sold your stock for by 4. If you use the Total Investment, you can just input the total sales proceeds from the sale of your stock as the Sale Price. Input your Sale Price on the numeric input screen and tap “Done”.
Your input of Sale Price must be consistent with your input of Purchase Price. A stock investment will be used to demonstrate how to select your Purchase and Sale Price. For other types of investments see Using Investment Return for Non-Stock Investments.
Example for 1 Share: If I bought 100 shares of Google December 20, 2004 at 188 I would put 188 as my Purchase Price. If I sold the 100 shares of Google on January 7, 2008 at 638 I would input 638 as my Sale Price, make sure my dates were set correctly and the tap Compute Return.
Example for Total Investment: If I bought 100 shares of Google on 12/20/2004 at 188 I would input 18810 as my Purchase Price (100 shares * 188/shr + $10 for commission). My Sale Price on 1/7/2008 would be 63790 (100 shared * 638/shr – $10 for commission). Then with my dates set correctly I would tap Compute Return.
Compute Return: When you have the values you want for all 4 input fields (Purchase Price, Purchase Date, Sale Price, Sale Date) tap the Compute Return button to see the compound annual return on your investment.
Outputs:
The first number you see on your output message box after tapping Compute Return is the Annual Return on your Investment, in percent, Compounded Daily. You are then told the number of days you held your investment. Finally, the number of years you held your investment is shown, rounded to a tenth of a year. After that is a confirmation of your Buy and Sell Price. For a discussion of why Compound Interest calculations are more accurate for your financial decision-making and Reconciliation of Inv. Return results with standard financial calculations, see Reconciliation with Standard Financial Calculations.