1. What is Stock Return?

Stock return measures the total percentage gain or loss on an investment, including both price appreciation and dividends received during the holding period.

2. How Does the Calculator Work?

The calculator uses the stock return formula:

Where:

• Final Price — Selling price or current market value
• Initial Price — Purchase price
• Dividends — Total dividends received during holding period

Explanation: The formula accounts for both capital gains/losses and dividend income to calculate total return.

3. Importance of Return Calculation

Details: Calculating total return helps investors evaluate investment performance, compare different investments, and make informed decisions about portfolio allocation.

4. Using the Calculator

Tips: Enter all values in dollars. Initial price must be greater than zero. Dividends can be zero if none were received.

5. Frequently Asked Questions (FAQ)

Q1: Should I include brokerage fees?
A: For precise calculations, you could adjust either the initial or final price to account for transaction costs.

Q2: What's considered a good return?
A: This depends on market conditions and investment horizon. Historically, 7-10% annual return is considered good for stocks.

Q3: How does this differ from annualized return?
A: This calculates total return for the entire period. Annualized return adjusts for the holding period length.

Q4: Should I adjust for inflation?
A: For real (inflation-adjusted) returns, you would need to use inflation data to adjust the final value.

Q5: Can this be used for other investments?
A: Yes, the same formula works for any investment where you can measure beginning value, ending value, and any income received.