This stock calculator forecasts your profit from the stock sale and dividends earned, your stock investment’s net return, its yield at sale time & annualized yield for the holding period. There is in depth information on how these indicators are calculated below the application.
How does this stock calculator work?
It might come in handy when trying to determine how much you will earn from your stock transactions (sale and dividends where the case).
The algorithm behind this stock calculator is based on the following variables that should be provided:
- No. of shares owned (NSO).
- Share price when purchased (SPP).
- Commission paid at the moment of buying them (CPB).
- Time shares were owned (TSO).
- Dividend received per share within the holding time (DRS).
- Share price when sold (SPS).
- Commission paid at sale (CPS).
While the formulas behind its algorithm are explained below:
- Gross return after stock sale: $[A]
[A] – is calculated by two different equations depending on what option is chosen by the user within the “Commission paid at sale” variable:
a) if the user chooses “per share” then:
[A] = (NSO * SPS) – (NSO * CPS)
b) if the user chooses “per total” then:
[A] = (NSO * SPS) – CPS
- Total investment made in stock: $[B]
[B] – is calculated by two different formulas that depend on what option is selected within the “Commission paid at purchase” field:
a) a) if the user chooses “per share” then:
[B] = (NSO * SPP) + (NSO * CPB)
b) a) if the user chooses “per total” then:
[B] = (NSO * SPP) + CPB
- Profit from stock sale: $[C] = [A] – [B]
- Dividends earned from stock: $[D]
[D] – is calculated by considering simultaneously on what the user selects within “Dividend received per share” field (“monthly”, “quarterly”, “semiannually” or “annually”); and on the option from the “Time shares were owned” field ( “months” or “years”). First step is to convert data from both fields such way to find the monthly dividend and the value of the time expressed in months. That is why where applicable, we will transform the values from the two fields mentioned above as explained here:
- IF “Dividend received per share” is:
* “monthly” then no conversion is made as it is in the right unit by default.
* “quarterly” then the monthly dividend equals the value the user inputs divided by 3;
* “semiannually” then the monthly dividend is equal to the figure specified by the user divided by 6;
* “annually” then the monthly dividend is determined by dividing by 12 the value given by user;
- IF “Time shares were owned” is:
* “months” then no conversion is made.
* “years” then the time expressed in months is the value given divided by 12.
- After the conversions described above are performed the [D] statement is:
[D] = Monthly dividend * Time in months shares were owned
- Stock investment’s net return: $[E] = [C] + [D]
- Yield at sale time: [F]% = (Annual dividend/SPS)*100
Annual dividend = Monthly dividend obtained by conversion at [D] * 12
- Annualized yield for the time share were owned: [G]% = ([E] * 100) / ([B] * N)
N is obtained by this method:
- if the “Time shares were owned” is in “months” then N = Time shares were owned/12.
- if the “Time shares were owned” is in “years” then N is the value given.
3 simple ways to increase your stock profits…
- Sell in a “maximum” point on graph, which means you should monitor when the price is higher than the acquisition price your paid (plus the associated costs you paid initially);
- Buy when the price is down on its “minimum” level over the period you were analyzing.
- Keep on a long term basis the stocks that pay an attractive level of dividends, by checking their investor’s policy and perspectives.
Example of a calculation
Let’s assume the following stock scenario:
- No. of shares purchased: 1,000
- Share price when purchased: $57
- Commission paid at purchase: $1/share
- Time shares were owned: 24 months
- Dividend received per share on an yearly basis: $4/year
- Share price when sold: $69
- Commission paid at sale: $1.2/share. Will result in these figures:
■ Gross return after stock sale: $67,800.00.
■ Total investment made in stock: $58,000.00.
■ Profit from stock sale: $9,800.00.
■ Dividends earned from stock: $8,000.00.
■ Stock investment’s net return: $17,800.00.
■ Yield at sale time: 5.80%.
■ Annualized yield for the time share were owned: 15.34%.11 Feb, 2015 | 0 comments