Portfolio Growth
Overview
A competing metric to the average arithmetic return used to gauge performance is portfolio growth.
Growth is a measure similar to average arithmetic return, but is instead
based on the average log return.
Growth has been shown mathematically to have a number of desirable propeterties that the arithmetic return
does not have. In particular its long run performance and its mult period properties seem to many
to be a better target for a managed portfolio.
Optimal Growth and Geometric Brownian Motion
