Simple Moving Average Return Calculator
Enter a series of periodic percentage returns to calculate their simple moving average, and see how it compares to the actual compounded return over the same periods.
What is a simple moving average return?
The simple moving average (SMA) return is the plain arithmetic mean of a series of periodic returns — add up each period’s percentage return and divide by the number of periods. It is one of the most common ways investors smooth out short-term noise to see a general trend.
How this calculator works
This tool takes up to five periodic returns (for example, monthly or quarterly percentage gains or losses) and computes their average using SMA = (R1 + R2 + … + Rn) ÷ n. It also calculates the actual compounded return over the same periods by multiplying (1 + each return) together, which better reflects real portfolio growth because it accounts for compounding.
- The arithmetic average tends to overstate long-term performance when returns are volatile.
- The compounded (geometric) figure is generally the more accurate measure of what an investment actually earned.
This calculator is provided for general educational and planning purposes only and is not investment advice.