Understand the idea
A quoted multiplier may describe the total amount returned, including the original stake. Confusing it with profit overstates the result.
Separate total return from profit
A quoted multiplier may describe the total amount returned, including the original stake. Confusing it with profit overstates the result.
Inside this edition
One topic. 3 useful perspectives.
3 sections
Context
Put it into practice
For a hypothetical 100-unit stake and a 2.5× total return, calculate 250 units returned and subtract 100 to get 150 units of profit before fees.
Know the limits
If the activity loses instead, the original stake may be lost; the example does not predict which outcome occurs.
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