| Category          | Data                                  |
|-------------------|---------------------------------------|
| Chart Title       | Asset That Loses $1 Per Day for 100 Days |
| X-axis            | Day                                   |
| Y-axis (Left)     | Asset Price                           |
| Y-axis (Right)    | Daily % Return                        |
| Asset Price Day 50 | 50                                    |
| Asset Price Day 100| 0                                     |

Asset That Loses -1.38% Per Day for 100 Days

2

Asset Price

Daily % Return (Right Axis)

120.0

2.00%

1.50%

100.0

Asset price = 50 on Day 50

1.00%

80.0

0.50%

60.0

<signature> Asset price = 25 on Day 100

0.00%

40.0

-0.50%

20.0

-1.00%

-1.50%

0

-2.00%

44 48 52 56 60 64 68 72 76 80 84 88 92 96 100

## Narrative

Chart 1 displays an asset with a constant dollar loss. On day 1, the percent return (red line) is -1%. By day 90, the daily percent return is -8%. At day 100 it is -100%. Chart 2 displays an asset with a constant percentage daily loss. This is the logic of annualizing returns, which is employed by the charts program. At a constant rate of loss (represented by the red line), the asset does not decline linearly.

At day 50, the price of both assets is 50. Annualizing* the 50 days of performance will yield different results, depending on whether you are projecting dollar losses or % losses. Chart 2 is the method in general usage.