1. What Is Daily Return Calculation?

Daily return calculation measures the percentage change in the Net Asset Value (NAV) of a mutual fund from one day to the next. It helps investors track daily performance and make informed investment decisions.

2. How Does The Calculator Work?

The calculator uses the daily return formula:

Where:

• \( \text{NAV End} \) — Net Asset Value at the end of the day ($)
• \( \text{NAV Start} \) — Net Asset Value at the start of the day ($)

Explanation: The formula calculates the percentage change in value, showing how much the fund gained or lost during the trading day.

3. Importance Of Daily Return Calculation

Details: Tracking daily returns helps investors monitor short-term performance, assess fund volatility, and compare daily results against market benchmarks.

4. Using The Calculator

Tips: Enter both NAV values in US dollars. Ensure values are positive numbers representing the actual NAV prices at start and end of the trading day.

5. Frequently Asked Questions (FAQ)

Q1: Why calculate daily returns for mutual funds?
A: Daily returns help investors track performance, identify trends, and make timely investment decisions based on short-term movements.

Q2: What is a good daily return?
A: This varies by fund type and market conditions. Positive returns are generally desirable, but context matters compared to benchmarks and historical performance.

Q3: How often should I calculate daily returns?
A: Typically calculated at the end of each trading day to monitor daily performance and track cumulative returns over time.

Q4: Can daily returns be negative?
A: Yes, if the NAV decreases during the day, the daily return will be negative, indicating a loss for that day.

Q5: How does this differ from total return?
A: Daily return measures single-day performance, while total return includes all distributions and measures performance over a longer period.