Total return

Price charts understate income payers

Costs and taxes come after

A worked example

A share that rose 5% and paid a 3% dividend delivered roughly an 8% total return for the period.

How we use it

Where we use historical price data, dividends and splits are handled from adjusted records so comparisons are not silently distorted.

Related terms

• Dividend yield
• Expense ratio
• Compound interest

Keep reading

• Investing Glossary

  Every investing term we use, defined once and in plain English — from compounding and drawdown to Form 13F and share dilution.

• Compound interest

  Compound interest is growth earned on both your original money and on the growth it has already produced. It is the reason long holding periods matter more th

• Dollar-cost averaging

  Dollar-cost averaging means investing a fixed amount on a fixed schedule regardless of price. It removes the need to decide when to invest, and it buys more s

• Free cash flow

  Free cash flow is the cash a business has left after paying the costs of running and maintaining itself. It is the cash that can fund dividends, buybacks, deb

• Expense ratio

  An expense ratio is the annual percentage of your money a fund keeps to run itself. It is deducted from returns quietly, every year, whether the fund performs

• Maximum drawdown

  Maximum drawdown is the largest peak-to-trough fall an investment has suffered over a period. It measures the worst stretch an investor would have had to sit