How to calculate return on MF ?

[coolsam]

I am not able to understand the above calculation. Could you please tell me in very simple terms with an example (if possible)?

Sorry! I am not very good in maths.

[Ram Naresh]

Following illustrations would help you in understanding of the above formula usage -
Example 1
You bought a fund at an NAV of Rs.25.32/-
The NAV appreciated to Rs.33.45/- in 8 months i.e., 240 days.
Then, the annualized return as calculated using MS-Excel is:

fx=POWER(number,power)-1
=POWER(33.45/25.32,365/240) - 1
=POWER(1.321,1.521)-1

which is 0.5272 or in other form, 52.72%

[Ram Naresh]

Example 2
You bought a fund at an NAV of Rs.12.86/-
The NAV went down to Rs.9.14/- in 3 months i.e., 90 days.

Then, the annualized return as calculated using MS-Excel is:
fx=POWER(number,power)-1
=POWER(9.14/12.86,365/90) - 1
=POWER(0.7107,4.0555)-1

which is -0.7497 i.e., -74.96% (the negative sign indicates loss)

Hope now its more clear to you.