ANNUALIZED RETURN:
"Say someone who is average 50% (150%, 25%, 0%, 25%) over 4 PSL, is that mean his annualize return = 200% from (50 X 4) or 400% from ((1.5 ^ 4) - 1). Or we should just use the quarterly return ((2.5 X 1.25 X 1.00 X 1.25)-1) = 290%."
If a person had averages of 150%, 25%, 0% and 25% over 4 PSL contests, their average would be 50% PER CONTEST. However, that is not 50% per year or per quarter or anything else. The contests were 6 months, 15 weeks, 15 weeks and 13 weeks.
It is correct to say that their overall return is 290% ((2.5 x 1.25 x 1.00 x 1.25)-1). But, 290% over an 18 month period (which is what PSL1-PSL4 has been) would translate to a 148% annualized return - compounded monthly.
In otherwords, if your monthly return was 7.85%, that would be 148% for 12 months and 290% for 18 months.
Since Stanu78 has the highest return for anyone who has participated in all 4 contests, I will do the math. His returns were 36.80%, 96.99%, 15.04% and 23.22%. His total average PER CONTEST is 43.01%.
His total return is +282% ((1.3680 x 1.9699 x 1.1504 x 1.2322)-1). His ANNUALIZED return is 144% based on a monthly compounded rate of 7.73%.
Len
Warren Buffet: 5 minutes and 17 seconds of pure, unadulterated, bulletproof, flawless logic.
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