Return is the profit or loss on an account over a period, expressed as a percentage. It reflects the change in equity regardless of deposits and withdrawals — a positive return is a profit, a negative return is a loss.
Formulas
Return (one period) = Equity_end / Equity_start
Return (n periods) = Return P1 × Return P2 × … × Return Pn
Return (%) = (Return − 1) × 100Periods
Returns are calculated for periods between balance operations (deposits, withdrawals, transfers): Equity_start is the equity just after a balance operation; Equity_end is the equity just before the next one.
Worked Example
A trader deposits $500, later deposits $400, then withdraws $500, with equity changing between each operation.
| Period | Equity start | Equity end | Return | Return % |
|---|---|---|---|---|
| P1 | $500 | $1,800 | 1,800 / 500 = 3.6000 | 260.00% |
| P2 | $2,200 | $3,000 | 3,000 / 2,200 = 1.3636 | 36.36% |
| P3 | $2,500 | $2,500 | 2,500 / 2,500 = 1.0000 | 0% |
| Total | — | — | 3.6000 × 1.3636 × 1 = 4.9090 | 390.90% |
Equity over time — what counts toward return
Trading performance (counts toward return)Deposit / withdrawal (excluded)
Each period resets after a deposit or withdrawal, so the cumulative return multiplies the per-period ratios — isolating trading performance from cash flows.
