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Annualized

Annualizing a number involves converting a short-term data point (such as a quarterly interest rate) into an annual rate. The resulting number is said to be “annualized.” 

Annualization commonly pops up in loan annual percentage rates (APRs) and individual and corporate income projections. Investors also use annualized investment outcomes to compare securities or determine if an asset’s projected returns meets their goals. 

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