A return is the amount of money earned or lost on an investment For example, if you start the year with $100, and at the end of the year, you have $110; that would mean you have a 10% return on your money.
What is my account summary return?
On Sarwa Trade we calculate your simple return on an account level. Simple returns are earnings in your portfolio divided by net deposits.
- Simple Return = Earnings ÷ Net Deposits
- Net deposits = Deposits – Withdrawals
Note: In a case where you've earned positive returns, and then withdrawn more money your simple return will be impacted.
For Example: If you have deposited $100 into your account and made 10$ returns (i.e., you total account balance is of 110$) your simple return will be of 10%. Here is why:
- Net deposits = $100
- Earnings = Account balance - net deposits = $110 - $100 = 10$
- Simple return = Earnings ÷ Net Deposits= 10 ÷ 100 = 10%
Now assume you have withdrawn $30 from your account brining your account value to $80, then your simple returns is now ~14.3%. Here is why:
- Net deposits = deposits - withdrawals = $100 - $30 = $70
- Earnings = Account value - Net Deposits = $80 - $70 = $10
- Simple Return = Earnings/Net deposits = 10/70 = ~14.3%