Context
I am trying to build a portfolio dashboard following this example, only instead of Excel, I am using Python. I am currently not sure how to conduct from 3:47 onwards, cross calculating to arrive at the next period balance.
Problem
Is there a way to conduct this in Python? I tried a for loop but it returned the same number iterated over the number of forward periods. Below is the example:
date_range = pd.date_range(start=today, periods=period_of_investments, freq=contribution_periods)
returns_port = 12
rs = []
balance_total = []
for one in range(len(date_range))):
return_loss = (returns_port/period_of_investments)*capital_insert
rs.append(return_loss)
period_one_balance = capital_insert+return_loss
period_two_return_loss = (returns_port/period_of_investments)*(period_one_balance + capital_insert)
period_two_balance = period_one_balance + capital_insert + period_two_return_loss
balance_total.append(period_two_balance)
I did not watch the video but I will explain how to write a Python code for the following problem, which is similar to the one in the video.
Suppose you want to calculate the return of investment of a fixed monthly deposit for the next 20 years with a fixed interest rate.
The first step is understanding how pd.date_range() works. If you started at the beginning of this month the whole period would be pd.date_rage(start='4-1-2021', periods='240', freq='1m') (240 comes from 20 years, 12 month each). Basically, we are calculating the return at the end of each month.
import pandas as pd
portfolio = pd.DataFrame(columns=['Date', 'Investment', 'Return/Loss', 'Balance'])
interest_rate = 0.121
monthly_deposit = 500
dates = pd.date_range(start="3-31-2021", periods=240, freq='1m')
investment = [monthly_deposit]*len(dates)
return_losses = []
balances = []
current_balance = 500
for date in dates:
current_return_loss = (interest_rate/12)*current_balance
return_losses.append(round(current_return_loss,2))
balances.append(round(current_balance + current_return_loss))
current_balance += (current_return_loss + monthly_deposit)
portfolio['Date'] = pd.to_datetime(dates)
portfolio['Investment'] = investment
portfolio['Return/Loss'] = return_losses
portfolio['Balance'] = balances
balance_at_end = balances[-1]
print(portfolio.head(10))
print(balance_at_end)
You will get the following result, which is identical to the video:
Date Investment Return/Loss Balance
0 2021-03-31 500 5.04 505
1 2021-04-30 500 10.13 1015
2 2021-05-31 500 15.28 1530
3 2021-06-30 500 20.47 2051
4 2021-07-31 500 25.72 2577
5 2021-08-31 500 31.02 3108
6 2021-09-30 500 36.38 3644
7 2021-10-31 500 41.79 4186
8 2021-11-30 500 47.25 4733
9 2021-12-31 500 52.77 5286
506397