A Portfolio Earned 20%, -20%, 0%, 20%, and -20% in Five

question 194

Short Answer

A portfolio earned 20%, -20%, 0%, 20%, and -20% in five successive years. What was the portfolio's five-year equivalent annually compounded rate of return?

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Definitions:

Stress

A physical, mental, or emotional factor causing bodily or mental tension, which can result from external environments, internal perceptions, or a combination of both.

Schizophrenia

A chronic mental health disorder characterized by distortions in thinking, perception, emotions, language, sense of self, and behavior.

Bipolar Disorder

A psychiatric condition defined by severe changes in mood, encompassing high phases (mania or hypomania) and depressive states.

Mood Swings

Rapid and often unpredictable changes in one's mood, ranging from periods of euphoria to periods of depression.