### Average rate of return

To calculate the average rate of return on investment for a given number of periods, enter the rates
for the same periodicity. For example, annual, monthly, etc. Use the point as decimal separator.

If an investment in three years has got in the first year a gain of 10%, 20% in the second and the third a loss of 15%, enter: 10, 20 and -15.
The correct result is 3.91%, calculated by the geometric mean, not 5%, calculated by the arithmetic mean.

This is the most appropriate way to calculate the average rate of return. Many people use the arithmetic mean instead geometric mean.

The results are automatically displayed after you click on **"Calculate"**.

Note: This calculator is for educational purposes. The accuracy and applicability to particular cases is not guaranteed.

### Related Topics

DuPont Analysis Investments - Net Present Value Discounted Cash Flow (DCF) Internal Rate of Return (IRR) Modified Internal Rate of Return (MIRR) Average Interest Rate Average Rate of Return Break-Even Point in Quantities Break-Even Point (BEP) in Sales French Amortization System Constant Amortization System German Amortization System Sinking Fund American Amortization System Canadian Mortgage Amortization Amortization - Average Constant and French Straight Line Depreciation Method Sum of Digits Depreciation Method (SYD) Balance Sheet Analysis Cash Flow Statement by Direct Method Cash Flow Statement by Indirect Method