# Error in calculation of ARR

ERROR - QuickTest calculates an ARR by multiplying the calculated return R by 365/Days. This can grossly underestimate the ARR for positive returns. With negative returns, VV reports an ARR of less than -100%, which is impossible. The correct formula is:

ARR= (1+R)^(365/days) - 1

Example: 3% gain or loss in one week

VV calculates ARR= 156% and -156%

Correct values: 365& and -80%

**3**votes

Jerrod Mason
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