Portfolio Performance Calculator
Returns with cash flows accounted for
Reading Portfolio Performance With Cash Flows
Total return in dollars strips out money you moved yourself: ending value minus beginning value, minus what you added, plus what you took out. The percentage version divides that gain by the invested basis — the starting value plus contributions — because measuring a gain against money you deposited halfway through flatters the result.
Annualised return converts the period into a compound annual rate. It grows the basis (start plus contributions) to the value you ended with plus withdrawals, then takes the years-th root. It is a useful approximation rather than an exact internal rate of return: a precise figure needs dated cash flows, since money deposited in month one earns far longer than money deposited in month eleven.
Time-weighted return answers a different question. It chains each sub-period's return geometrically, which removes the effect of when cash moved in and out and isolates the strategy's own performance. Use total and annualised return to judge your account, and time-weighted return to judge the plan behind it.
Frequently Asked Questions
What is the difference between money-weighted and time-weighted returns?
Money-weighted returns (IRR) include the size and timing of your own deposits, so they reflect the experience of YOUR account. Time-weighted returns strip out cash flows and measure the manager's or portfolio's performance itself. Compare funds with time-weighted numbers and judge your own plan with money-weighted ones.
Why is my portfolio return different from the change in my balance?
Your balance changes with contributions and withdrawals as well as market moves. A balance that grew 12% while you added 8% in deposits did not earn 12% from investing. The calculator separates cash flows from investment return so the percentage reflects what the money actually earned.
Should I account for fees when measuring performance?
Yes. Fund expense ratios, advisory fees and trading costs quietly reduce net returns, and the gap compounds over decades. Enter the value of your portfolio after fees to see the return you truly keep; that net figure is the one that moves you toward your goals.
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Historical Investment Returns by Decade
- Alex starts at 25: Invests for 40 years. Total contributed: $240,000. Portfolio at 65: $1,320,510
- Jordan starts at 35: Invests for 30 years. Total contributed: $180,000. Portfolio at 65: $609,896
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Data Sources & Citations
- OfficialInternal Revenue Service (IRS)
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