1. What is Expected Capital Gains Yield?

The Expected Capital Gains Yield (CGY) is the anticipated price appreciation of an investment, expressed as a percentage of its current price. It helps investors estimate potential returns from price changes alone, excluding dividends or other income.

2. How Does the Calculator Work?

The calculator uses the Expected CGY formula:

Where:

• \( \text{Expected Price} \) — The anticipated future price of the investment (USD)
• \( \text{Current Price} \) — The current price of the investment (USD)

Explanation: The formula calculates the percentage change between the expected future price and the current price.

3. Importance of Expected CGY

Details: Expected CGY is crucial for investment analysis, helping investors compare potential returns across different assets and make informed decisions about portfolio allocation.

4. Using the Calculator

Tips: Enter the current price and expected future price in USD. Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: How is Expected CGY different from total return?
A: Expected CGY only considers price appreciation, while total return includes all income sources like dividends.

Q2: Can Expected CGY be negative?
A: Yes, if the expected price is below the current price, indicating an anticipated loss.

Q3: What time period does this calculation cover?
A: The calculation is period-agnostic - it depends on the time horizon of your expected price.

Q4: How accurate are Expected CGY calculations?
A: Accuracy depends on the reliability of your expected price estimate, which involves uncertainty.

Q5: Should I use this for short-term trading?
A: While useful, short-term trading requires additional analysis of volatility and market conditions.