Returns

A Weighted Average Cost of Capital (WACC) Calculator

The Weighted Average Cost of Capital (WACC) represents the rate a company is expected to pay in financing its assets. The WACC calculates the company’s cost of capital by proportionately weighing the categories of capital, each of which would be in the form or debt or equity. The WACC for a company is [...]

Calculate the Expected Return of an Investment

The Expected Return of an investment is the average of a probability distribution of possible returns for that investment. Although investors do not know with certainty what rate of return their investments will yield, they can base their decisions on their expectations by assigning a level of probability to a number of possible outcomes. [...]

An Internal Rate of Return (IRR) Calculator

By definition, the Internal Rate of Return (IRR) is the rate of return at which the net present value of a stream of payments is equal to zero and is presented as an annualized compounded rate of return which can be earned on invested capital. The IRR provides a measure that companies can use when [...]

A Future Value of Money Calculator

“Money makes money. And the money that money makes makes more money.”
- Benjamin Franklin
The Future Value of Money is the sum that an investment with a fixed, compounded interest rate will grow to by a specified future date. For purposes of the calculation, the investment can be a single, lump sum deposited at the beginning [...]

Recovering from Stock Market Losses
(includes calculator)

Most stock market investors, if they are at it long enough, lose some amount of money. It is, unfortunately, the nature of stock market investing and inherent to the risk profile of stock market investing. It is said that the difference between successful stock market investors and the others is in their approach [...]

Dividend Payments and Total Return on Stock Investments (includes calculator)

When measuring the performance of a stock investment, your total return is comprised of capital gains and any dividend distributions realized. Dividend income is, in fact, a critical consideration when calculating total return and it is unfortunate that many investors mistakenly believe that total return consists merely of any stock price appreciation during the [...]

A Capital Asset Pricing Model (CAPM) Calculator

The Capital Asset Pricing Model (CAPM) is used to estimate the rate of return an investor should expect to receive given the risk profile of a stock (or another asset). In calculating the expected return on the stock, the CAPM factors in this risk along with the time value of money to arrive at [...]

Inflation, Taxes, and Stock Investment Break Even Return (includes calculator)

One of the most important calculations for an investor to perform is the breakeven return they need to compensate for the impact of inflation and taxes. If your investments return lower than this break even point, you will lose money on a post-tax, post-inflation basis.
Inflation is an increase in the price of a basket [...]

A Compound Annual Growth Rate (CAGR) Calculator

CAGR is the compound annual growth rate of an investment (or anything measurable) over a particular period of time. The calculation represents a steady level of growth from a beginning value to an ending value and is used to smooth out uneven investment returns. This enables investors to effectively evaluate performance by [...]

Understanding the Time Value of Money (includes calculator)

Time value of money is the idea that money available to you right away is worth more to you than that same amount in the future. This is because money has the potential for earning capacity. According to this concept you are better off receiving money right away so you can invest and earn [...]