Return on margin

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Return on margin (ROM) is often used to judge financial performance because it represents the net gain or net loss compared to the exchange's perceived risk as reflected in required margin to trade financial instruments.

ROM may be calculated (realized return) / (initial margin).

The annualized ROM is equal to (ROM + 1)(year/trade_duration) - 1

For example if a trader earns 10% on margin in two months, that would be about 77% annualized.

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