(MONEY Magazine) – If fear of flashbacks to Mr. Worpenstein's high school trigonometry class has kept you from mastering your finances, put that math phobia aside. The handful of ratios and calculations outlined below are practically second nature to seasoned investors, and they should be to you too. And relax: They don't require skills any more advanced than multiplication and long division.

Specifically, the formulas you'll learn in this story can help you choose an investment, track its performance and figure the results when you sell. You don't even need a computer to do this math. A low-tech pencil, paper and calculator will do just fine. The only research required is to pull out your brokerage or mutual fund statements and read financial newspapers or company reports in Value Line Investment Survey, a reference book available at most libraries. Armed with these tools, you can calculate answers to the following six investment questions.

--How long will it take to double my money? Because the interest your investments earn begins to earn interest itself, you can double your money faster than you might think. A guideline called the Rule of 72 lets you estimate the interval at any given rate of return. Simply divide 72 by the annually compounded rate of return to get the number of years required to hit a two-bagger. Say you own a stock fund whose average annual return has been 8%. If the fund continues to grow at that pace, you'll have a double in nine years (72 divided by 8 equals 9). Choose a savings account earning 5%, and you'll wait more than 14 years to double your stake.

--How do I know if a stock is a good buy? One quick way to gauge whether a stock is reasonably priced--and has good prospects for price appreciation--is to calculate the so-called PEG ratio. That figure is the stock's P/E ratio (the stock price divided by analysts' per-share earnings forecast for the current year) divided by the company's expected earnings growth rate. (A company growing at 25% a year and selling at 25 times earnings has a PEG ratio of 1.) A PEG of less than 1 is a rough indicator that the stock may be a good buy. You'll find both the stock's P/E ratio and its three- to five-year estimated growth rate in Value Line Investment Survey.

How reliable is the PEG ratio? Prudential Securities analyst Claudia Mott researched the performance of 5,041 midcap stocks from 1982 to 1996. Those with PEGs of less than 0.75 returned 19.2% a year on average, vs. 10.8% for those with PEGs of 2 or more. Even so, a low PEG is no guarantee of future greatness. "The PEG ratio is a starting point," says Seattle money manager Robert Porter, "not a substitute for in-depth analysis."

--Is the stock market overvalued? One way to tell is to calculate what's known as the earnings yield on Standard & Poor's 500-stock index. To do that, divide the market's P/E multiple into 1 and multiply by 100 to get a percentage. (You can find the P/E in the Wall Street section of Money; this month it's on page 53.) Then compare the answer with the yield on the 30-year Treasury bond, which you can find in major newspapers. Whichever yield is lower is more expensive. Today, the comparison is not encouraging for stockholders: The earnings yield of the S&P 500 is 5.2% (1 divided by a 19.1 P/E times 100), while the 30-year Treasury yield stands at 6.4%. (The earnings yield is just the price/earnings ratio turned upside down. The P/E is what investors will pay for each dollar of earnings the stocks of the S&P 500 are expected to produce this year. The earnings yield measures the profits that the S&P 500 stocks are expected to produce for each dollar invested.)

If the earnings yield for the S&P 500 remains below the long-term Treasury yield for at least six months, you may want to tweak your portfolio and increase your bondholdings. (The yield on stocks has been lower since January.) So if you normally have 30% of your portfolio in bonds and the earnings yield for the S&P 500 is lower, you could put 35% in bonds.

--Should I choose a tax-free investment over a taxable one? Paying less in taxes is one piece of math everyone can understand. But inevitably, tax-free bonds have lower yields than comparable taxable bonds before figuring in taxes. So until you run a fair comparison between taxable and tax-exempt investments, you can't tell which works better for you.

This worksheet can help you run that direct comparison. The formula calculates what's called the taxable-equivalent yield for a tax-free bond or bond fund. That is simply what you would have to earn on a fully taxable investment to get the same after-tax return. Let's say you are in the 28% federal tax bracket and have a choice between a taxable money-market fund yielding 5% or a tax-free money-market fund yielding 3.25%. Your taxable-equivalent yield in that tax-free fund is 4.5% (or 3.25 divided by 0.72, which is 1 minus your tax bracket), so you would be better off buying the taxable fund yielding 5% and paying the taxes.

--What's my portfolio's annual return? You can find out how an individual mutual fund did in the past year by checking out Money's semiannual fund tables, but calculating how your fund portfolio performed is your problem. "It's good to have an idea of your portfolio's annual return so you can compare that with a benchmark like the S&P 500," says Steven Enright, a financial planner in River Vale, N.J. The worksheet above can help you do just that.

Before you start, you'll need to know the value of your portfolio today and a year ago. Plus, you'll need to look up how much and when you withdrew or added money to your funds during the year. For line 4 you must calculate an average monthly balance for the year. To do that, add up your running balances (excluding market gains) for each month of the past year and then divide that total by 12.

Say, for example, you started with an initial balance of $1,000, added $100 in April but withdrew $200 in October. To figure your average balance, you would add $3,000 (the first three months of the year had a $1,000 balance), $6,600 (the next six months at a $1,100 balance) and $2,700 (the final three months at a $900 balance) and divide by 12, which comes out to $1,025. If you invest the same amount each month, take a short cut and add half your net additions to your initial balance to come up with your average monthly balance.

--How do I figure out my tax bite when I sell my shares? After you unload stocks or fund shares, you need to know what you paid originally--your cost basis, in taxspeak--so you can calculate your profit and pay taxes on it. The concept is simple, but the answer isn't always obvious. "One of the most common and expensive errors investors make is to use the wrong basis to figure their gains," says Ed Slott, an accountant and author of Your Tax Questions Answered (Plymouth Press, $9.95).

To make these calculations, you need to dust off copies of your annual brokerage and mutual fund statements, which should list the value of what you bought or sold every year. When it comes to calculating your profits, you have three primary methods. The first, which applies only to mutual funds, is an average cost per share. The others are first-in, first-out, or "FIFO," and specific identification.

With the average-cost method, you merely total the amount of money you invested and divide that figure by the number of shares you own. (See the worksheet below.) So if you bought 10 shares at $50 one year, five shares at $80 the next and another 10 shares at $75 after that, your average cost would be $66 per share (or $500 plus $400 plus $750, divided by 25 shares). The good news is that many fund companies calculate the average cost for you.

With FIFO, if you sell just some of your shares, your gain is based on what you paid for the first shares you bought. So, using the previous example, if you sold 15 shares your cost basis would be $50 for the first 10 shares and $80 for the next five. That comes to $60 a share on average, which means a heftier tax liability. The final method, called specific identification, allows you to dodge that trap. You must specify which shares you want sold, in any order. In the case above, for example, you could instruct your broker or the fund company in writing to sell the 10 shares you bought at $75 as well as the five shares you bought at $80 (make sure you get written confirmation from the company as well). That would increase your basis to $77 a share on average. Okay, now subtract your basis from what you reaped for selling your stock or funds. Then fork over as much as 28% of that to the IRS. Sorry.

Put your pencils down. Time's up. Study these formulas carefully. We're liable to hit you with a pop quiz.