i think i got it not too sure tho ...?? so i guess think of starting out with 100% year 1 you have return 25% which is also +25% so 100% + 25% = %125 or 1.25
@@aileenmeraz1661 u can use normal formula i.e; Nth root product of X1, X2, X3... Which is APPLICABLE FOR "NON NEGATIVE NUMBERS" here in stocks we get NEGATIVE values and we can't find particular solution if we have negatives in under root, so we need to add 1 to every variable and product them ((1+X1). (1+X2).(1+X3)...) and take Nth root of resulting Nth root, lastly SUBSTRACT 1 FROM THE ANSWER.
Yeah it tells you the constant rate. So if you put your money in a bank that paid minus 1% you'd get the same result. Its most useful when you don't want to deal with all the detail of the years in the middle. Just take the end value, divide by the start value, and raise to 1/n, and you'll get (1+the equivalent constant rate of return).
because 99.9% of the time you are looking for net return, if you don't subtract "1" then you end up with gross return. Whenever you see a return on a financial website (i.e. looking at a stock's daily increase on Yahoo Finance), it will be listed as just the % increase in price from the previous trading day. For example if a stock goes up from $100 to $110, it will be shown to have increased by 10% from the previous day which is it's net return. If we wanted gross return, it would be listed as 110%, because that 1 isn't subtracted out.
cody get an HP12c and learn to use the registers. Once you learn RPN entry and master the use of the registers, you’ll never use another calculator again.
fvck this shit is so frikinnn hard why did i took this class
Very helpful, thanks!
Glad it was helpful!
Good explanation! But I don't knw how I will come up with does decimal numbers. Am I the only one that is confused in that part😭😭😭
Which one u didn't understood?
25% --> 1.25?
i think i got it not too sure tho ...??
so i guess think of starting out with 100%
year 1 you have return 25% which is also +25% so 100% + 25% = %125 or 1.25
@@aileenmeraz1661 u can use normal formula i.e; Nth root product of X1, X2, X3... Which is APPLICABLE FOR "NON NEGATIVE NUMBERS"
here in stocks we get NEGATIVE values and we can't find particular solution if we have negatives in under root, so we need to add 1 to every variable and product them ((1+X1). (1+X2).(1+X3)...) and take Nth root of resulting Nth root, lastly SUBSTRACT 1 FROM THE ANSWER.
So how is that -1% useful? On average given volatility the portfolio will lose -1%?
Yeah it tells you the constant rate. So if you put your money in a bank that paid minus 1% you'd get the same result.
Its most useful when you don't want to deal with all the detail of the years in the middle. Just take the end value, divide by the start value, and raise to 1/n, and you'll get (1+the equivalent constant rate of return).
Is it the same as CAGR(Compound Annual Growth Rate)?
just out of curiosity. why are we subtracting all of it by 1 ??
because 99.9% of the time you are looking for net return, if you don't subtract "1" then you end up with gross return. Whenever you see a return on a financial website (i.e. looking at a stock's daily increase on Yahoo Finance), it will be listed as just the % increase in price from the previous trading day. For example if a stock goes up from $100 to $110, it will be shown to have increased by 10% from the previous day which is it's net return. If we wanted gross return, it would be listed as 110%, because that 1 isn't subtracted out.
good stuff !!!!
Why do the easiest problem possible? Anyone can do this part. Add variables plz
Thank you!!!!!
How do you calculate a growth rate of 400% and a loss of -133% is that even possible?
HOW DO YOU DO THIS MATH IN BA II PLUS CALC???? ITS IMPOSSIBLE
cody get an HP12c and learn to use the registers. Once you learn RPN entry and master the use of the registers, you’ll never use another calculator again.
This assumes I know how to calculate to 1/3 power. I don’t.
Did you find how to calculate 1/3, if yea, please let me know
@@robinpathania1400 I found two videos that showed how to do it on financial calculators and I was able to adapt it to the calculator I was using.
Point is... why raised to the power 1÷n ??
that's the same as taking the nth root (x^(1/n) = x root n)
Y is this soo tough.. Can somebody just help me out with geometric mean
i thought this wood help me refun geimetre dash not rewl thing
Don’t be lazy and show your work so people can understand.