Is there any difference?

Installations & Python Packages
1

Course Name: Financial Time Series Analysis for Trading, Section No: 4, Unit No: 12, Unit type: Notebook

Hello, calculating the "log differences" and "log returns" I realized that they are the same. Am I wrong?

https://i.imgur.com/1kU7TQe.png

https://i.imgur.com/HZdOMXR.png

2

Hi Daniel,



You are right. The "log differences" and "log returns" are essentially the same. We say "returns", because if we had bought the asset at the close of one day and sell at the close of the next day, we will get a "return" which is equal to the difference between the close prices of the two days.



Log returns have certain advantages over simple returns which has been explained in the section which you have referenced. 



Thanks.

3

Thanks!