What Is Stock Return Calculator?
Stock return calculator is a great online tool to find out the returns earned from investing in any stocks (equity) within few steps. Suppose, If you have invested or thinking of investing in any stock in future, stock return calculator will tell you about the future worth of your investment based on expected returns, also the profit earned from making that investment.
Many of us invest our money without calculating the average CAGR (compound annual growth rate) of stock in past and thus do not know how much to expect from our own investments. Hence, such investments are more based on luck than logic.
How Stock Return Calculator Works?
In order to use below moneycontain stock return calculator , you need to enter the price at which you bought the shares of a stock, second enter the quantity and expected returns and at last enter the time period i.e. tenure of the investment made in months.
The stock return calculator will show you the total invested amount, profit or return your investment have made and the total investment worth.
Let us understand this through a simple example, suppose you are thinking of investing in SBI (state bank of India) currently trading at Rs.430 on 18 July 2021, and you want to buy 200 quantity for 2 years with an expectation of 18 % p.a. returns.
How much can you get at the end of the investment period?
Stock return calculator can give you the answer instantly which by the way is Rs.1,19,746, Rs.33,476 profit garnered on investment of Rs.86,000. Just to keep in mind the calculator does not take the count of dividends if paid by the company while showing returns.
So go ahead and give it a try, use stock return calculator yourself below and find all your the investment worth in stocks in future.
Now, that you have used the stock return calculator, I would like to bring your attention to some of the important aspects related to returns, please read below you will find something which is really going to help you in making investments further.
How To Find Out Historical Returns Of Stocks?
If you are friend asks you do you know how much return MRF, which by the way is the most expensive stock listed on Indian exchange as of now, have generated in last 20 years, Or for that matter any other stock.
What you are going to do?, open your stock brokers trading platform look at the chart and find how at what price the stock was trading for the particular month and year.
But that would only show you the price at which the stock was trading not the average returns it has given to investors in last 20 year.
Let us do a simple exercise in order to find the historical returns of any stock. Suppose, You want to invest in Asian Paints but before doing so you want to see how much returns it has given to investor in last 1 year.
Now, to do that you open the trading platform and looked the charts of Asian Paints and the price at which it was trading in July 2020, which is around Rs.1,645 which by the way is also the 52 week low for the stock. Look at the image below taken from NSE website
As you can see the stock is currently trading at Rs.2,989, now a simple way to do this is using moneycontain CAGR Calculator .
Let me show you how, Suppose you just bought 1 quantity of Asian Paints whose price was at Rs.1645 in July 2020 i.e. a initial investment and the stock is currently at Rs2,989 right now which is ending value, by using the CAGR calculator we find out that Asian Paints has given a whopping CAGR returns of 81.70% in last one year.
Checkout the image below to know more:
Now we put the same returns in stock return calculator to see if it shows the correct investment worth, check below image:
As you can see in the image above the investment worth is Rs.2,989 which is exactly the price at which the stock is currently trading the market.
Similarly, using the same method you can find out the expected CAGR returns and enter that returns in stock return calculator, instead of any random choice of yours to be on the better and rational side.
This way you can find out the historical returns of any stock in share market and calculate your investment worth within few steps.
Having said that, last year most of the stocks were beaten down due to Covid hence you saw huge returns of about 81%, but that is not setting the right expectation hence we should atleast take last 5 to 10 years data in consideration.
Let us see another stock but this time will take last 10 years data, for this I am choosing ICICI Bank which currently trading at Rs.654,on 19 July 2021 . I am checking the price of ICICI in 2011 July month using a chart through a trading platform.
ICICI Bank closed in July 2011 around Rs.188, Let us see first the CAGR returns of the stocks in last 10 years using the same method above. This time let say you bought 100 quantity so the total initial investment at that time would have been Rs.188*100= Rs. 18,800.
The current price is Rs.654*100= Rs.65,400
This means the CAGR returns would have been around 13.28% p.a.
Now we put the same data in stock return calculator, which show the investment worth, at Rs.65,417, check the image below:
Now, this would be the best method of finding out the returns when you can expect before making an investment as you have average cagr returns which can be used to find out the future worth using the stock return calculator.
So, suppose ICICI Bank is growing on average 14% P.a. if you buy the stock now at current price you can approximately estimates your profit in future.
But why you are going to do that, it is because the more higher returns a stock has garnered in the past more likely the future returns would be somehow equal.
This will help you in finding higher return stocks rather than just picking up any random stock and expecting good returns.
Having said that, Your investment decision can’t be made based on CAGR itself, specifically if you are investing in stocks (equities) as you need to look for the other risks like systematic and un-systematic risks.
Conclusion:
Investing in stocks in share market is one of the best way to groww your capital, there is no other financials instrument which generates such profits. However, one should always do proper technical and fundamental analysis before investing.
Stock return calculator is beneficial for anyone who is looking to invest to short, medium or long term as it sets the right expectation before investing.
As due to inflation the value of money will get automatically eroded one should always keep in this mind and start investing as early as possible in life.
Therefore, instead of keeping money idle in bank or spending it without purpose, you should make investments either in stock market through equity(stocks), ETF, SGB etc. or lumpsum SIP investment in a mutual fund scheme.
One can make other forms of investment as well such as:
- Equity Linked Savings Scheme (ELSS) – 15-18% (market-linked)
- National Pension Scheme (NPS) – 8-10% (market-linked)
- Public Provident Fund (PPF) – 7.1%
Other than above Post Office Monthly Income Scheme (POMIS) which is a government-promoted savings scheme offered by the Department of Post (DoP) or Indian Post. POMIS gives investors monthly returns in the form of interest payments.
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Note: Please do not take this as any recommendation, to trade or invest. This is just for reference, to make you understand more about Stock Return Calculator and its importance, under no circumstances intended to be used or considered as financial or investment advice, a recommendation or an offer to sell, or a solicitation of any offer to buy any securities or other form of financial asset.
Please do your own research and make investment. Moneycontain will not be responsible for any of your losses at all. The point made is for educational purpose only and intended to give information. All investments are subject to risks, which should be considered prior to making any investments.
