Assuming day 1 my wealth is 1. At day 2 I earned 20%. So the rate of return is 0.2 and the wealth at day 2 is 1.2. At day 3 I earned 50 % again. So the wealth at day 3 is 1.8. I wonder what is the value of 1, 1.2, 1.5 for each is called in academic?
closed as off-topic by vonjd, LocalVolatility, chollida, phdstudent, Bob Jansen♦ Mar 23 '18 at 9:09
This question appears to be off-topic. The users who voted to close gave this specific reason:
- "Basic financial questions are off-topic as they are assumed to be common knowledge for those studying or working in the field of quantitative finance." – vonjd, LocalVolatility, chollida, phdstudent, Bob Jansen
It's called 'Gross return' (a.k.a. 'Gross Rate of Return'). See Zivot Course Notes Eqn. 1.8
Also, as pointed by Alex C:
... in Statistics it is called a 'link relative' or 'chain relative' (because it links together (via multiplication) adjacent terms of the CPI index or other time series)