I don't like "annualized gains"

[IronFist]

I don't like how they talk about annualized gains. It kind of doesn't make sense. They say "this trade had 50% annualized gains" but you traded with like 2% of your account so who cares? It's not like you're making 50%. Seems like marketing.

If I have a 5000 account and I get a position using 300 and I sell it for 330 in a month, that's 120% annualized gains, but I didn't make 120%. I made .6%.

 

[narafa]

It's assumed to be used to compare investment returns over different time horizons (By normalizing) and also to normalize the investment amount/size.

But it has become a big marketing tool as you said. Just don't look at it.

It's ironic no-one ever talks about annualized losses as they talk about annualized gains.

 

[Nobert]

How much in % up on portfolio per annum is all that matters & nothing else.

Lot's of folk killed it on GME or whatever and still red on 2020 / YTD.

 

[Scataphagos]

I don't like how they talk about annualized gains. It kind of doesn't make sense. They say "this trade had 50% annualized gains" but you traded with like 2% of your account so who cares? It's not like you're making 50%. Seems like marketing.

If I have a 5000 account and I get a position using 300 and I sell it for 330 in a month, that's 120% annualized gains, but I didn't make 120%. I made .6%.

People like to toot their own horn when they've done something good. "Annualizing" is a way of projecting that same performance into the future... which we all know is BS.

If you want to tout your results, they need to be good enough for long enough. Nothing else matters.

 

[murray t turtle]

I don't like how they talk about annualized gains. It kind of doesn't make sense. They say "this trade had 50% annualized gains" but you traded with like 2% of your account so who cares? It's not like you're making 50%. Seems like marketing.

If I have a 5000 account and I get a position using 300 and I sell it for 330 in a month, that's 120% annualized gains, but I didn't make 120%. I made .6%.

%%
OK;
but makes much more sense than weekly/monthly gains + i like+ take weekly gains. I see your points..........................................................................