Know your zero. Brought to you by math.
Moderator: Aitrus
Know your zero. Brought to you by math.
I am confident this has been posted at some point, but it always bears reminding.
I see lots of folks talk about a drop in the market or taking a loss on a failed IFT. Most just want to get the loss back, i.e., get back to zero. In percentages, zero moves around a little bit. For example, the nominal loss from a 10% decline is not recovered by a subsequent 10% gain (100 - 10% = 90; and 90 + 10% = 99).
If you want to know "your" zero, here is the math:
X = (A / (1 - (A / 100)))
I
X = your zero %
A = the % decline
E.g., if I lose 5% in one move, I must recover 5.2% to get back all my losses.
X = (5 / ( 1 - (5 / 100)))
.05
1 - .05 = .95
5 / .95 = 5.26315
X = 5.2...
Good luck and remain cognizant of your real goal.
I see lots of folks talk about a drop in the market or taking a loss on a failed IFT. Most just want to get the loss back, i.e., get back to zero. In percentages, zero moves around a little bit. For example, the nominal loss from a 10% decline is not recovered by a subsequent 10% gain (100 - 10% = 90; and 90 + 10% = 99).
If you want to know "your" zero, here is the math:
X = (A / (1 - (A / 100)))
I
X = your zero %
A = the % decline
E.g., if I lose 5% in one move, I must recover 5.2% to get back all my losses.
X = (5 / ( 1 - (5 / 100)))
.05
1 - .05 = .95
5 / .95 = 5.26315
X = 5.2...
Good luck and remain cognizant of your real goal.
-An economic forecaster is like a blind javelin thrower; although rarely accurate, he keeps your full attention.
-
- Posts: 4330
- Joined: Tue Aug 19, 2008 8:51 pm
Re: Know your zero. Brought to you by math.
Nice. A while back I asked for a formula to determine the rate of gain in the TSP Funds. Do you have a formula for determining that?
Re: Know your zero. Brought to you by math.
crondanet5 wrote:Nice. A while back I asked for a formula to determine the rate of gain in the TSP Funds. Do you have a formula for determining that?
(Price_2 - Price_1)/(Date_2 - Date_1) For change in price/time
If you want a % over time, then:
(Price_2 - Price_1)*100/(Price_1)(Date_2 - Date_1)
Owner/creator of TSPcalc.com - "Know your numbers"
- sgtnichols
- Posts: 120
- Joined: Sat Jan 09, 2016 10:17 pm
Re: Know your zero. Brought to you by math.
Nicely explained. Thanks for that.
Fund Prices2024-04-18
Fund | Price | Day | YTD |
G | $18.19 | 0.01% | 1.27% |
F | $18.62 | -0.30% | -3.14% |
C | $78.45 | -0.21% | 5.50% |
S | $76.12 | -0.20% | -1.27% |
I | $40.67 | 0.02% | 1.21% |
L2065 | $15.58 | -0.13% | 3.04% |
L2060 | $15.58 | -0.13% | 3.04% |
L2055 | $15.58 | -0.13% | 3.04% |
L2050 | $31.35 | -0.13% | 2.44% |
L2045 | $14.32 | -0.12% | 2.35% |
L2040 | $52.37 | -0.11% | 2.29% |
L2035 | $13.85 | -0.10% | 2.21% |
L2030 | $46.21 | -0.09% | 2.15% |
L2025 | $12.93 | -0.05% | 1.72% |
Linc | $25.28 | -0.04% | 1.51% |