Annualized 5% refers to calculating the annual rate of return by changing the rate of return for a period of time (one day, one month, one quarter, etc.). ), the annual rate of return is 5%. Annualized income is very common in bank wealth management products. For example, what is the monthly yield of a wealth management product, then the annualized yield of this product is = (principal × monthly yield) × 12/ principal.

What is the annualized rate of return?

The annualized rate of return is the ratio of the income obtained after one year of purchasing wealth management or making other investments with a certain principal divided by the principal. If it is the income obtained after n years of investment, the annualized rate of return is the income divided by n and then divided by the principal. Because many investment products (mainly bank wealth management products) have different maturities, we can clearly compare the differences of investment products' income by measuring the income in a unified time, so there is the saying of annualized income. So don't think that you will get a lot of benefits just because the annualized rate of return is very high, and also count the term of the product.

It is worth noting that the annualized income of bank deposits, bonds and bills refers to 360 days a year, while the annualized income of investment markets such as securities and futures refers to 250 days a year.