Decomposing a change in returns

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Decomposing a change in returns

Postby Guest » Tue Sep 17, 2019 7:58 pm

Hello,
I'm working on decomposing a change in returns from one period to another period.

In 2018, my return is calculated as \$20 income divided by \$100 in capital (20% return).
In 2019, my return is calculated as \$50 income divided by \$200 in capital (25% return).

Is there a way to decompose the 5% return into something like: 8% is from a change in income, and -3% from an increase in capital?

Thanks so much for any advice.
Guest
 

Re: Decomposing a change in returns

Postby Guest » Wed Jun 10, 2020 11:22 am

What "5% return"? You mention only a "20% return" and a "25% return". And you say nothing about an "increase in capital" so there is no way your question can be answered.
Guest
 


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