Andrzej Karpio Deposit portfolio rate of return
Article explains how to measure deposit portfolio rate of return. Described portfolio contains deposits, which differ from each other by fixed overtime interest rates. As a starting point we assume continuous dependency from period of capital possession. That requires a new concept of the rate of return on investment measure, which will be different from traditional one. Author stresses that as the measure can be used logharitm time of rate of return in different intervals. Such an interval interest rate of return means that rates of return sum up to a rate of return. That value characterises capital variation during a whole investment period, in some measures globally. That definition implies characterisation capital growth rate by using short-term rate of return, which has a form of weighted average where weights are particular deposit share in whole investment. After a lapse of time it tends to highest of interest rates among stated deposits.
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