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How are rolling returns of a mutual fund calculated

How are rolling returns of a mutual fund calculated?

Jul 2, 2016 by Archana Vaidya, Mumbai  |   Mutual Fund

Rolling returns are the annualized returns of the scheme taken for a specified period (rolling returns period) on every day/week/month and taken till the last day of the duration. There are two important parameters in the rolling returns, the period over which you want to see the rolling returns and the investment horizon (also known as the rolling return period).

For example, if you have three year investment horizon (holding period) and want to see rolling returns of a mutual fund scheme from 1/1/2006 to 1/1/2016, you start by calculating annualized return from 1/1/2006 to 1/1/2009 (change in NAV between 1/1/2006 to 1/1/2009, annualized). Next calculate the annualized return from 2/1/2006 to 2/1/2009, then from 3/1/2006 to 3/1/2009, so on so forth. Basically, you are calculating the 3 year annualized returns of the scheme on every date, over the last 10 years.

It is difficult to do these manually, but you can easily do this on excel. We have developed a Rolling Returns calculator where you can see rolling returns of any open ended mutual fund scheme. The visualization of rolling returns in our calculator is both in graphical / chart format and tabular format.

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