Hello Accelerated Math Students! As part of your Quarter 2 investment project, you will post on this blog using your holiday pseudonym. You will also comment on two other posts. EXTENDED DUE DATE: SUNDAY DECEMBER 11, 2016. The grades are now finished for the blog.
Saturday, December 3, 2016
Difference between average annual growth rate and rate of return
I did not understand the difference between average annual growth rate and rate of return. So I emailed Mrs.Bassette and asked for help. So, she emailed me back telling me what Investopedia said. Investopedia said,"Average annual growth rate (AAGR) is the average increase in the value of an individual investment, portfolio, asset or cash stream over specific interval of time. Rate of return is a profit on an investment over a period of time, expressed as a proportion of the original investment." (Both definition came from Investopedia) Furthermore, Mrs.Bassette explained it to me in a more simplify way. She told me that "(AAGR) means average growth rate over many years." "(Rate of Return) means growth rate over most recent year."
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thank you for the explaination
ReplyDeleteThank you for explaining it here because I didn't know what the average annual growth rate meant.Thanks to this post, now I know that it means it's the average increase in the value of an individual investment, portfolio, asset, or cash stream over specific interval of time.
ReplyDeleteThis was a very informative post. I also researched rate of return in Investopedia. Aside from being the progressive gain/loss of profit on an investment, rate of return can be defined as the net amount of discounted cash flows received.
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