Investment Return Calculator: Plan Your Financial Future
Our investment return calculator is a powerful financial planning tool that helps you visualize how your savings could grow across different investment vehicles. This tool calculates your potential returns using key parameters such as your initial amount, monthly investment, and investment period.
Calculation Method and Formula
The investment return calculation is based on the compound interest principle and takes into account regular monthly investments. The mathematical formula used is:
FV = P(1 + r)^t + PMT × [((1 + r)^t - 1) / r]
- FV = Future Value
- P = Principal (Initial Amount)
- r = Annual Return Rate (in decimal)
- t = Investment Period (years)
- PMT = Monthly Investment × 12 (annual total)
Different Investment Vehicles and Expected Returns
We present three different scenarios for each investment vehicle: pessimistic, average, and optimistic. These scenarios are based on historical data and market analysis:
- Stock Market: Stock Market (S&P 500): Shows the potential returns of investing in America's leading companies. Historical data shows that the stock market has the potential to provide returns above inflation in the long term.
- Gold: Gold: A traditional store of value, gold is seen as a safe haven during periods of economic uncertainty. Return calculations take into account international gold prices and currency exchange rate fluctuations.
- Bank Deposit: Bank Deposit: A low-risk investment vehicle. Return rates are calculated based on the Federal Reserve policy rate and deposit interest rates offered by banks.
- Government Bond: Government Bond: This investment vehicle, backed by government guarantee, offers fixed returns. Calculations are made considering the trading volume and yield curve of government bonds in the secondary market.
- Cryptocurrency: Cryptocurrency: A modern investment vehicle with high risk and high return potential. Due to its high volatility, scenarios are calculated over a wide range.
Risk and Return Relationship
One of the fundamental principles of the investment world is the direct relationship between risk and return. Investment vehicles offering higher potential returns typically carry higher risk. Therefore, it's important to consider your risk tolerance, investment goal, and time horizon when making investment decisions.
Diversification Strategy
Not putting all your eggs in one basket is one of the golden rules of the investment world. Diversifying your portfolio across different investment vehicles helps optimize potential returns while reducing risk. Our calculator allows you to compare potential returns of different investment vehicles, helping you make informed diversification decisions.
Important Note: The return rates presented are estimates, and past performance is not a guarantee of future performance. We recommend seeking professional financial advice before making investment decisions.