How to Find the Percentage Loss of Investment in the Stock Market

Many individuals lose money in the stock market every day. The loss they are referring to might not be an accurate amount, though. Determining the loss in a stock market based on the maximum value of stocks before a drop is not the proper way to compute a loss. Instead, the initial investment in the stock market must be considered along with the price in which an individual sells his stocks. Remember, a loss or gain only exists after the sale of stock.

Instructions

1. Determine the amount you paid to invest in the stock market. Any time you invest in stock, you should keep a record of the number of stocks and the price you paid for those stocks. Multiply the number of stocks you purchased for each individual stock times the price you paid per share of stock.

2. Complete Step 1 for each stock that you purchased in the stock market. Once you have the totals for each stock, add up the total of all of your stocks combined.

3. Determine the amount of money you have received from selling any of these shares previously. In other words, determine how much you received for the stocks you already sold and no longer own.

4. Multiply the current number of shares in each stock you own times the current stock price for that stock. You must do this individually for each stock you own. Write down these individual totals.

5. Add your totals from Step 4 to your total from Step 3. This combined total should be subtracted from the number you computed in Step 2. This will tell you your net loss in the stock market currently compared with the amount of money you originally invested.

6. Compute your percentage loss. Take the net loss you computed in Step 5, and divide that by the cost you paid to purchase your stocks, which you determined in Step 2. This will give you a decimal result as your answer. Move the decimal point two spaces to the right. This will now tell you the percentage you have lost in the stock market compared with the amount of money you spent in your initial investment.

Tips & Warnings

• Always track the price of a stock and the number of shares you purchase if you wish to compute your net loss or net gain in the stock market at a future date. Finding this information later without proper record keeping can be very difficult.

• Dividends are not factored in to your net loss or neg gain when computing the percentage. The only time dividends are computed in this calculation is if they are used to purchase additional stock.