Annualizing daily average stock price?

[sleepybird]

Given daily stock prices, we can calculate the daily standard deviation and convert it to an annual standard deviation by multiplying it by SQRT(252).
We can also calculate the daily average (the mean) of the stock price but how can we convert it to an annual term?
Thanks

 

[ShaktiRathore]

Hi,
THe scaling factor for annualizing returns is T so multiple daily return by 252 to get in annual terms.
calculate the daily returns as ln(St/St-1) and then take the average of these returns over the entire 252 day period and then multiply by 252. so the final average daily return is=ln(S1/S0)+ln(S2/S1)+ln(S3/S2)+.......ln(S252/S251)/252=ln(S252/S0)/252 so the annual return is 252*(ln(S252/S0)/252)=ln(S252/S0) which is nothing but annual return.

thanks

 

[sleepybird]

hi shaki
thanks the problem is that i want it in absolute dollar. how do you scale the dollar price of stock, not the return?
thanks