Annualized Return

What is annualized return?

The term annualized return refers to the total return on a portfolio or investment during any period other than a year, which is then restated as what would have occurred for the year.

Example: Ted sells a stock in one month for a 10% return. It is then stated that he achieved a 120% annualized return. Annualized returns are generally used to describe mutual fund performance.

Other names for annualized returns: yearly return, one-year return, 1-year return, annualized return, and compounded rate of return.