How can I determine my account’s percentage growth, especially after making deposits or withdrawals?
Understanding your account’s growth percentage, particularly when you’ve added or removed funds, can be approached in a few ways. Let’s walk through a common scenario to illustrate:
Imagine the following activity in your account:
- Initial Deposit (December 27, 2024): You deposit . Let’s call this .
- Withdrawal (April 2, 2025): You withdraw . Let’s call this . Your capital base in the account after withdrawal is Co – C1 = ($20,000 – $10,000) = Co= $10,000
- Trading Profits (by April 4, 2025): You’ve accumulated in trading profits. Let’s call this .
- Final Balance (April 4, 2025): Your account balance is now the capital base plus your profits. .
How has your account grown in percentage terms?
Here are a few ways to interpret and calculate this:
-
Growth Based on Capital After Withdrawal: This method considers the growth on the amount of capital that was actively “working” for you after your last significant cash flow (the withdrawal). The formula is: ((Calculation: ((
Interpretation: Your account grew by 791.4% based on the capital base that remained after your withdrawal. -
Growth Relative to the Initial Deposit: This method compares your final balance to your very first deposit, irrespective of intermediate withdrawals or deposits (though those make this method less precise for performance measurement).
The formula is: (In this simple case, considering only the initial as the total “investment” for this view, though this isn’t strictly a performance metric if you’ve withdrawn significant capital).
Calculation: Interpretation: From your original deposit to your final balance of , the account value (including your capital actions) increased by 345.7%. -
Return on Investment (ROI) Based on Net Profit vs. Initial Deposit: This measures your total trading profits against your initial capital contribution. The formula is: Calculation: Interpretation: Your net trading profits represent a 395.7% return on your initial investment.
Important Note: Different platforms and individuals might prioritize one calculation method over others depending on what aspect of performance they want to highlight. For tracking true investment performance over time with multiple cash flows. The examples above offer common ways to conceptualize your growth.