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I'm trying to understand how to calculate annual growth for a forex account when there are multiple deposits. For example

  1. Jan 1 -> Initial deposit 1000
  2. Jan 15 -> 25 profit, then growth = 2.5%, capital = 1025
  3. Jan 30 -> 25 profit, then growth = 5.0%, capital = 1050
  4. Feb 1 -> Additional deposit 1000, capital = 2050
  5. Feb 15 -> 25 profit, then growth = ???

How can I mix in the new deposit in the calculation?

Any help is greatly appreciated

1 Answer 1

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You can use the time-weighted return method

a = 1025/1000
b = 1050/1025
c = 2050/(1050 + 1000)
d = 2075/2050

r = a b c d - 1 = 0.0628049

The return from Jan 1 to Feb 15 is 6.28049 %

That is 45 days, so annualising

(1 + r)^(365/45) - 1 = 0.638957

The annualised return is 63.8957 %

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