Rate of return

1. Discrete returns

Let \(P_t\) be the asset price at time \(t\) and \(P_{t-1}\) be the price in the prior period - day, week, month, ... For daily returns on stocks, \(P_{t-1}\) is the closing price of the stock on the previous trading day.

Example calculations are provided in figure 1 - Excel Web App #1 - Sheet1, where a sample of stock price data is used.

1.1 Net return

1.2 Gross return

Fig 1: Excel Web App #1 Rate of return - with discrete and continuous methods

2. Log returns

3. Returns method selector panel

4. Cumulative returns

4.1 Cumulative discrete returns

4.2 Cumulative log returns