Performance of investment portfolios

To calculate a total portfolio return, we will use the returns we have previously calculated, shown in the table.

Let’s assume you bought all of these investments, therefore you have invested a total sum of $600,000.

There are two ways of calculating the performance; both methods are helpful to know.

The first and most simple calculation of the portfolio return is the total dollar return divided by the dollar investment:

   Return = $26,949 / $600,000 = 4.49% (0.0449)