Our free Annualized Rate of Return Calculator determines the rate of return on a compounded-interest investment or account.

What is an annualized rate of return?

Creditor-debtor agreement terms may vary but they all include a requirement to compare dividend rates, also called rates of return. Annualization does that by calculating an equivalent annual dividend rate from a given dividend rate and a non-annual compounding time period. This time period is also expressed in terms of “periods per year,” and refers to how often a given rate is applied and calculated to compounded-interest investments.