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Excel is a useful tool to assist with investment organization and evaluation. Learn how to improve your investing with Excel with the following easy steps!  

 

Have you thought about using Microsoft Excel as a financial tool? Actually, you can use Excel to weigh the gains and losses before you invest. Microsoft Excel was originally created to organize data, data entry, charting, and making graphs. Millions of online freelancers work using only Microsoft Excel. 

 

Jobs like data entry and accounting require their employees to work with this program. Although it looks complicated, once you are clear about your work and several functionalities, Excel is more fun than you know. Also, you can use Excel to classify positions, enter the starting price, closing price, and returns. Apart from providing a delicately and precisely organized financial statement. This article is about how to utilize Excel for your investments.

 

Contents:

Advantages of Using Excel

How to Improve Your Investment

Investment Tracking

Formulas for Differences

Percentage of Return Formulas

Profit & Loss Creation

Calculation of Standard Deviation

Seeing the Portfolio

Final Thoughts

 

Advantages of Using Excel

Here are some of the advantages why everyone should try and use Excel. First of all, you can easily calculate your financial returns, other benefits are:

  • You can quickly compare the performances of different investments
  • You may track your investment by tracking the values
  • You can know the degree of volatility
  • You can make important calculations automatically and repeatedly

 

How to Improve Your Investment

Excel is an amazing tool and you can use it to improve your investments. There is a lot you have to do before you make an investment. Apart from research and having an emergency fund source, you need to make proper calculations. Following are some of the points that explained why Excel is the best tool!

 

Investment Tracking

When you want to follow an investment in Excel, you have to be sure about what you are tracking. You enter the data that you want to track. Things like entry price, size of the share, closing price, date, and several other investment-related formulas. Investment tracking is one of the most important things while investing in any financial asset. 

 

Formulas for Differences

The difference formula is calculated by entry price minus the entry price. Such calculations are made manually if you are not using Excel. In the spreadsheet, all you have to do is enter the formula in the cell.

 

It will automatically use the values needed to calculate the difference for every entered data. You can drag the formula to proper cells when you want a difference for a specific dataset. 

 

Percentage of Return Formulas

Percentage of return is one of the most important parts of the investment spreadsheet. The formula is the current price minus entry price and then the difference is divided by the entry price. Entering the formula in the required cell will give you the return percentage every time you have a new entry. Also, you have to change the format of the cell to percentage. 

 

Profit & Loss Creation

In the same above-mentioned manner, profits or losses can also be calculated automatically. The formula is the difference multiplied by the number of shares. If you want to mention the currency, you would need to go to “Format Cells” and select “currency sign”.

 

For every entered data, you may know if you have a profit or a loss. A positive sign is for-profit and a minus sign is for loss. You can follow the profits and losses and prepare a forecast of the values. 

 

Calculation of Standard Deviation

Apart from gains, you need to know the risks of the investment. Standard deviation is the value you get to know the deviation of the extreme from the average value. The volatility of the investment can be determined by standard deviation.

 

The formula is quite complex and manually the calculation is even more tedious. Excel is the place where you can just enter the formula and see the magic unfold. Lower the standard deviation is and so will be the risk. 

 

Seeing the Portfolio

If you have your money invested in different shares, you can compile all your data from different spreadsheets into one. If the values are all the same in all the spreadsheets then you can compile all the data into one.

 

Your portfolio is visible to you anytime and anywhere you want. It also helps you to compare different shares and the way the values differ. The result might give you an idea of where to invest and where not to invest next time. 

 

Final Thoughts

To conclude, we would like to say that Excel is one of the best to improve the tracking of investment and calculate the profits and losses. Moreover, Microsoft Excel is available on multiple platforms, smartphones, and other devices. You can avail the same sheet using the internet across any device and at any point of time without saving which is really convenient.

 

The data is saved automatically. Also, several people can work together on the same spreadsheet. When you make an investment, you sometimes have to talk to several people and make the calculations. With Excel, you can do so alone. Even the most complicated formulas can be calculated by Excel!