Table of Contents


This is the part 3 of our Python for Stock Market Analysis series and here, we will explore some of popular growth rates that can be used to see how well is our value is changing over the period of time. Lets take some of scenarios:

The scenarios can be many more but lets focus on some.

Again we will be using the data reading part's code from the previous blogs.

Rate of Return

Lets suppose that we bought a stock 2 months ago and we want to find out how much profit we currently have then we might subtract the price at the time we bought from the current price. And it can be simply called return. The rate of return is simple measurement that tells us how much has been the price increase from the base period. It is calculated as:

$$ ror = \frac{V_{current}-V_{initial}}{V_{initial}} * 100 $$

RoR is the simplest growth rate and it does not take external factors like inflation into consideration.

Month Over Month (MOM) Growth Rate

This is the simple measurement of the growth rate where we simply calculate the rate of change from the previous month.

$$ rate = \frac{v_t - v_{t-1}}{v_{t-1}} * 100 $$


Lets calculate this in our python. But first, lets make a dataframe to store the closing price of the month only.