Definition
Annualised return
The annualised return converts a total return into a yearly rate, so investments held for different lengths of time can be compared on the same basis.
It assumes the return compounds at a constant rate, which rarely happens in practice. Use it as a comparison tool rather than a forecast.
Tools that use this term
ROI Calculator
Return on investment: profit, ROI percentage and how long the money is tied up.
Property ROI Calculator
Total return on a property: rental profit plus capital growth, and the annualised rate.
Compound Interest Calculator
What a starting amount plus regular deposits grows into, and how much of it is interest.