The value of a stock will move up and down during the market day as investors buy and sell shares. Traders who move in and out of stocks with short-term trades want to know the daily return on an individual stock. Other investors just like to know how much they made if one of their stocks has a big day. The calculation method can also be used with a stock market index to determine how much the market moved during the day. Calculating returns involves dividing the difference between two values by the starting value. Stock declines result in negative returns.
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Look up the closing share price of the stock and the closing price from the previous day. The prices can be found by entering the stock symbol on finance websites like Yahoo! Finance or Google Finance (see Resources).
Subtract the previous day's closing price from the current day's close. If the stock increased in value, the number will be positive. A down day will result in a negative number. For example, your stock finished yesterday at £16.0 and today the price fell and finished at £14. Subtracting the prices give a minus £1.70.
Divide the result by the previous day's close and multiply by 100 to convert to a percentage. Continuing our example, divide 2.75 by 24.75 for a result of 0.1111. Multiply by 100 to get a daily stock return of -11.11 per cent.
Tips and warnings
- Do not forget to multiply by 100 to convert to a percentage.
- Some financial websites will provide the daily percentage value change as well as the dollar amount change. Practice your math to see if you get the same results.
- Daily stock returns do not reflect the long-term results of stock investing.
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