Glossary
Total Return
Total return is the overall gain or loss from an investment over a specific period, including both price appreciation (or depreciation) and any income received—such as dividends or interest. It gives a complete picture of how an investment performs.
How is total return calculated?
Total return = (Ending Value − Beginning Value + Income Received) ÷ Beginning Value × 100%. It accounts for both capital gains and income.
Why is total return important?
It reflects the full impact of both market changes and income on your investment—unlike price return, which only shows price changes.
What’s the difference between total return and price return?
Price return only considers the change in asset price. Total return includes both that change and any dividends or interest earned.
Can total return be negative?
Yes. If the loss in value exceeds the income earned, or if the market declines sharply, the total return can be negative.
What types of investments benefit most from total return analysis?
Stocks, bonds, ETFs, and mutual funds—especially those that pay dividends or interest—should be evaluated using total return to get an accurate performance view.
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