Trading vs. Buy & Hold

The Power of Compounding & The Burden of Taxes

Simulation Parameters

The starting amount of your investment.
$10,000
The number of years for the simulation. Max duration is based on the selected asset's history.
10 years
1y10y

Total Return (10 yrs):30,409%

Gross CAGR:78.79%

Net CAGR (after tax):73.74%

The total percentage return of the asset over the entire duration. (Disabled when a real stock is selected).
1,000%
The trader's average annual growth rate before taxes.
15%
The tax rate applied to realized profits. Assumed to be paid annually for the trading strategy.
25%

Buy & Hold (Gross)

The final value before any capital gains taxes are paid.

$3,337,828

Net CAGR: 78.79%

Trading (Net)

The final value after paying taxes on gains every year.

$29,040

Net CAGR: 11.25%

Buy & Hold (Net)

The final value after paying a one-time tax on the total profit at the end of the duration.

$2,505,871

Net CAGR: 73.74%

Buy & Hold Net outperformed Trading Net by 8528.96%.