Calculation Methodology

ReturnLab calculates mathematical outputs from the principal, period, return rate, loss rate, and spending amount entered by the user. Results are not predictions or guarantees of investment performance.

Where useful, the site shows summaries, tables, and detailed values so users can inspect the calculation rather than only seeing one final number.

The core compound formula is “final amount = principal × (1 + period return) ^ number of periods.” A daily return of 1% is calculated as 0.01.

Target period, required return, and required starting capital modes use the same relationship and solve for a different variable.

The required gain after a loss is calculated as “loss rate ÷ (1 - loss rate).” For example, a 50% loss requires 0.5 ÷ 0.5 = 100% gain to recover.

Recovery time is shown as the first period where the remaining amount, after repeated recovery returns, reaches or exceeds the original principal.

Principal-preserving cash flow uses “annual income = principal × annual yield,” then divides that amount into monthly or daily figures. The estimate is before taxes and fees.

Drawdown mode subtracts the selected spending amount first, then applies the period return to the remaining principal. This is used for questions such as how long money can last or how much can be spent over a chosen period.

Very large values and long simulations may be displayed as approximations within browser numerical precision. Detailed values and tooltips are used where they help inspection.

For spendable amounts, some displayed values are floored rather than rounded when rounding up could imply spending more than the calculated amount allows.

Default calculations exclude taxes, fees, exchange rates, inflation, slippage, liquidity, trading halts, execution risk, losing periods, dividend cuts, and interest-rate changes.

Outputs should be used to understand mathematical structure and sensitivity. Actual investment decisions remain the user’s responsibility.