Cryptocurrency Glossary: Annualised Return | CoinIQ

What it means: Annualised return shows how much your investment has grown (or shrunk) per year, on average, over a given period.

In plain terms: Think of it as your investment’s “speedometer”, how fast it’s been growing each year, smoothed out to avoid being tricked by short-term ups and downs.

Example: If you invested £1,000 in shares that grew to £1,500 in three years, your average annualised return is about 14.5%. That means, on average, your money grew by 14.5% each year.

Bonds vs Equities vs Crypto:

Bonds: Usually lower annualised returns (2-5%) but stable.
Equities: Higher returns over time (6-10%) but bumpy.
Cryptos: Can show huge annualised returns (50%+), but these are often wildly inconsistent.

How to use it: This metric works best when combined with volatility. A high annualised return might look great, but if it comes with wild fluctuations, it could be risky. If you see a steady, positive annualised return paired with low volatility, that’s a healthy sign. Review this metric regularly but don’t panic over short-term dips.

Portfolio Analytics, for serious crypto investors.