Comments on: Fun Math: How to Calculate Returns Using Monthly Data

By: jhill

jhill — Tue, 25 Aug 2009 16:22:39 +0000

What is the reasoning behind this math. Why can’t you just add up the returns for the month to get ytd?

By: Natasha26

Natasha26 — Wed, 19 Nov 2008 19:16:43 +0000

I’ve used the method for a while but I can’t justify how the growth figures(%) of a couple of months can be used to represent the growth for an entire year (YTD)?

So if ur fund started in March, then at the end of month, the growth for March and YTD are the same!? Then you carry on doing so for each coming months as in, YTD = (1+r_Mar)*(1+r_Apr)*…-1

Any comments on that? thanks.

By: Leland Holliday

Leland Holliday — Tue, 11 Nov 2008 15:15:14 +0000

I used your method to calculate YTD return (thru 10/31/08) for each of the mutual funds in my portfolio. I expected my personal return on each of the funds to be different from published numbers, since I had done major transfers between funds in June. Instead, to my surprise, the numbers I calculated were identically the same as the published numbers. Why? Should I use a different method to compute my personal returns?

BTW, for those who do not have access to the =Product() function in Excel, an alternate method is to take the natural log of each of the monthly factors, sum the natural log values, and then take the exponent of the sum. In MS Works, the formula would be =exp(sum(B2:B13))-1, where B2:B13 contains the natural log values of the monthly factors.

By: Question From a Reader - Am I Calculating My Returns Correctly? | AllFinancialMatters

Mon, 10 Nov 2008 19:44:45 +0000

[...] This comment was left by Leland Holliday on an old post, Fun Math: How to Calculate Returns Using Monthly Data: [...]

By: Leland Holliday

Leland Holliday — Mon, 10 Nov 2008 18:12:52 +0000

I used your method on each of the funds in my portfolio for YTD 2008 (thru 10/31/08). The results I got exactly matched the YTD values published in WSJ and on the Fidelity and Vanguard websites. That surprised me, since I had made major transfers during June (greatly reducing the amounts in stock-based funds). Thus, I expected my personal rate of return in those funds to be different from the published returns. Am I doing something wrong, or is the method wrong for my situation?

By: dan russo

dan russo — Mon, 06 Oct 2008 16:03:27 +0000

hi could you please calculated for me the s&p 500 for the las 15 years on your worksheet.say from 1/1/1993 to 9/30/2008. thanks very much great worksheet.

By: jatin

jatin — Wed, 30 Jul 2008 08:58:30 +0000

clarification for jatin Says:
July 30th, 2008 at 3:49 am

since HTML formatiting is not here , so my earlier calculation looks horrible and senseless.

i will try to explain.. all i have done is this…

for Jan , 100*1.51= 101.51
for Feb ,101.51*-1.96= 99.5204

and go on till sep

Sep closing is 109.128

YTD= (closing-opening )/ opening*100
= (109.128-100)/100*100
= 9.128

By: jatin

jatin — Wed, 30 Jul 2008 08:54:09 +0000

Jatin’s clarification for
July 30th, 2008 at 3:49 am

god… I cant paste HTML format here…
nobody can understand what i wrote on July 30th, 2008 at 3:49 am here.

all i have done is
Jan:- 100…..*1.51 = 101.51
Feb:- 100.51..*-(1.96%) = 99.5204

and so on upto Sep

.Anyways.. if someone really wants it in excel, then mail me

By: jatin

jatin — Wed, 30 Jul 2008 08:49:18 +0000

I use another way to calculate YTD. It makes more sense to me.. See if this helps others also.
Let the index value ( amount) on 1 Jan be 100..
Now, add 1.51% to 100 , so closing = 101.51…
This way caculate for Feb till Sep as below:-

Month Amt.(Op.) Amt(closing.)
Jan 100 1.51% 101.51
Feb 101.51 -1.96% 99.520404
Mar 99.520404 1.12% 100.6350325
Apr 100.6350325 4.43% 105.0931645
May 105.0931645 3.49% 108.7609159
Jun 108.7609159 -1.66% 106.9554847
Jul 106.9554847 -3.10% 103.6398647
Aug 103.6398647 1.50% 105.1944626
Sep 105.1944626 3.74% 109.1287355

YTD= (closing-opening )/ opening*100
= (109.128-100)/100*100
= 9.128

By: chris

chris — Mon, 19 May 2008 15:09:26 +0000

hey thanks!