Question
Your portfolio had the following Total Returns for the past 3 years: 2019 10.32% 2018 -4.36% 2017 7.38% a. Calculate the arithmetic average (simple average)
Your portfolio had the following Total Returns for the past 3 years:
2019 10.32%
2018 -4.36%
2017 7.38%
a. Calculate the arithmetic average (simple average) return over the past 3 years
b. Calculate the Compound Annual Return (Geometric Mean) over the past 3 years
c. If you established the portfolio with $100,000 at the beginning of the 3 years, took nothing out and added no additional money, how much would you have in your portfolio today?
d. If the average annual inflation rate over the past 3 years was 1.25%, what was the inflation adjusted average annual return. (Use the Compound Annual Return in this calculation)
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