What is the annualized return of the fund you are holding?
Take Mr Chan’s investment in Fund A as an example:
Subscription Date: 30 December 2009
Subscription Price: HK$10.20
Redemption Date: 30 June 2014
Redemption Price: HK$13.05
The accumulated return Mr Chan earned from investment in Fund A is 28%. Does it mean that he can get an average return of 6% per annum during 4.5 years investment horizon?
No. Return is not simply computed through dividing the fund return by number of years. A more accurate method is to convert the accumulated fund return as annualized fund return in order to reflect the fund investment horizon and compounding effect. From Mr Chan’s example, he can get an annualized return of 5.7% from Fund A.
You can have a trial calculation of your annualised fund return by using below calculator:
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The following risk disclosure statements may not disclose all the risks involved. You should undertake your own research and study before you trade or invest. You should carefully consider whether trading or investment is suitable in light of your own financial position and investment objectives.
Risk Disclosure Statement:
The above information and calculation results are for reference only. The results are based on certain assumptions and may not reflect all the relevant factors (such as transaction fee), thus you should not rely on the results to make any investment decisions.
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