What is Percent Change?

What Is Percent Change and How Do You Calculate It?

By Anders Bylund – Updated Aug 12, 2025 at 12:57 PM EST

Key Points

Percent change measures stock value changes over time, helping compare investments.
Tracking percent change reveals investment volatility and trends, assisting risk assessment.
Utilize percent change for standardized comparisons across varying investment sizes.

You may have heard the term "percent change" thrown around a lot in investing circles. But what does it mean? Why should you care about it? And how can you use it to make better investment decisions?

Let’s have a look.

A stock chart hovering in the green, then plunging deep into the red, with percentages and stock quotes in the background. — Image Source: Getty Images

Percent change is a simple concept that measures the increase or decrease in a value or quantity over time. It is expressed as a percentage of the original value. For example, if the price of a stock increases from $40 to $50, the value increases by 25%. Similarly, if the price of a stock falls from $50 to $40, it drops 20%.

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Navigating the percentage changes in 2020

Let's look at a real-world example of percent change in action. In 2020, the stock market experienced a significant downturn due to the COVID-19 pandemic. The S&P 500 index fell by 34% between the start of the drop on February 19 and the rock-bottom reading of March 23.

Although this may seem like a significant plunge, it was also a quick crash and it’s important to consider the percent change over the longer term. From March 23 to Dec. 31, 2020, the S&P 500 index increased by 68% as investors looked past the health crisis with effective vaccines on the horizon. All told, the S&P 500 gained 16% in 2020.

By looking at the percent change over the entire year, investors can see that the market actually recovered from the pandemic-induced downturn and ended up posting impressive gains. A short-term decrease in value may be concerning, but if the investment has a history of positive long-term performance, it may still be a sound investment. Keeping an eye on percentage changes in light of market-moving news can help you buy the dip or stay on the sidelines, as appropriate.

If you get used to looking at percent changes instead of dollar changes, and to put these price moves into the context of longer periods and the overall market’s returns in the same time spans, you’ll find it easier to monitor and evaluate your investments.

About the Author

Anders Bylund is a contributing Motley Fool media and technology analyst covering semiconductors, cloud computing, internet infrastructure, quantum computing, and streaming media. Previously, Anders was a systems administrator for Nielsen Technology and CSX, gaining hands-on experience with enterprise-class systems. He was also a freelance writer for Ars Technica, TIME, USA Today, CNN, WIRED, and AOL's Daily Finance. He holds a bachelor’s degree in English and a master’s degree in library and information sciences from Florida State University. He believes in coyotes and time as an abstract.

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Anders Bylund has positions in Amazon. The Motley Fool has positions in and recommends Amazon. The Motley Fool has a disclosure policy.