How do you calculate ytd returns

Using the YTD period sets a common time frame for assessing the performance of securities against each other and against their benchmarks. It also is useful for measuring price movements relative to other data, such as the economic indicators. YTD measurement is important, but keep in mind that the information it conveys is limited.

Most investors and analysts also look at longer time periods, such as three-year and five-year returns, to get past short-term trends and see how a portfolio, a stock, or an index is performing over time. Calculating the YTD return of an entire portfolio is the same as for a single investment. Take the current value of all assets in the portfolio and subtract the total amount invested on the preceding January 1st.

This renders the total YTD return in dollars. Dividing this figure by the original value and multiplying by converts the figure into a percentage that represents the return generated by each dollar originally invested.

Over the past year, each dollar you invested produced 20 cents of profit. If your investment paid interest or dividends during the year, this amount must be included in the current value of the portfolio since it counts as profit. Though the value of the portfolio has not changed, its YTD return is higher because it generated income through dividends as well as capital gains. Financial Analysis. Portfolio Management. Fixed Income Essentials. Tools for Fundamental Analysis. Your Privacy Rights.

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Breadcrumb Resources Finance. Table of contents. What does year to date mean? How is year to date used? YTD returns Another common application of YTD is in calculating profit made by any investment from the first date of the current year. We can help GoCardless helps you automate payment collection, cutting down on the amount of admin your team needs to deal with when chasing invoices. Related topics Finance.