The mutual fund returns calculator is a free online tool which can help you see whether you have actually made a profit on your mutual fund investment. Simply enter the amount invested, the current value of the investment and the number of years the investment has been held and you will immediately be able to work out the absolute return of your investment, as well as the annualised return (CAGR). No spreadsheets to build, no sign up and no formulas to remember. This calculator converts any numbers into a clear and comparable percentage, instantly, whether you're checking a fund purchased this year, or one that's been held for 10 years.
What Are Mutual Fund Returns?
Mutual fund returns provide a reflection of the value of the money that has been invested in a mutual fund for a period. There are two measures that count and each provides an answer to a different question.
Absolute Return
Absolute return: The net gain or loss percentage, regardless of how long the period of time. If ₹1,00,000 grows to ₹1,50,000, your absolute return is 50%. It is simple, but it doesn't tell you how long it took to achieve that gain, 2 years or 20.
Annualised Return (CAGR)
The compound annual growth rate (CAGR) is the consistent annual growth rate an investment would need to have to become its current value. It takes into account the time and allows you to make a comparison between two funds based on a three-year holding period and a seven-year holding period.
Mutual Fund Returns Formula
The calculator has two common formulas!The calculator has two normal formulas!
Absolute Return (%) = (Final Value - Initial Value) / Initial Value x 100
CAGR = (Final Value ÷ Initial Value)^(1/t) − 1
In this case, t is the number of years that you had the investment. To read the output of the CAGR as a percentage, multiply it by 100. CAGR is used to convert total return into a yearly rate which is a more accurate reflection of the rate of return when comparing funds. If you change any of the numbers in the calculator it instantly recalculates so you can try out different scenarios without doing the maths again.
How to Use the Mutual Fund Returns Calculator
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Enter the amount you invested (₹).
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Enter the amount of money that is due (₹).
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Type in the number of years the stock is held.
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Instantly read absolute and CAGR returns, and alter any value to make comparisons.
Mutual Fund Returns Calculation: Worked Example
Suppose you invested ₹1,00,000 in a mutual fund and it is now worth ₹1,80,000 after 5 years.
|
Invested |
Current Value |
Tenure |
Absolute Return |
CAGR |
|---|---|---|---|---|
|
₹1,00,000 |
₹1,80,000 |
5 years |
80% |
~12.5% |
Absolute return is (1,80,000 − 1,00,000) ÷ 1,00,000 × 100 = 80%. CAGR is (1.8)^(1/5) − 1, which is about 12.5% a year.
Now know the importance of time. A 3-year time frame would have resulted in a CAGR of approximately 21.6% if the 80% gain was over 3 years. The absolute return is the same but the annual performance is very different. Both cases can be reproduced in the calculator above and then the calculator can be used to experiment with different numbers.
Why Use an Online Mutual Fund Returns Calculator?
It takes a long time to do powers and percentages by hand, and doesn't take long at all to get it wrong. This is where an online calculator comes in handy as it takes away the temptations to make a mistake and provides you with a result you can count on.
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View both absolute and annualised returns in one go.
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Treat fairly: evaluate performance based on the same criteria for funds held for different periods of time.
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Make fast changes to the current value or tenure and see the changes reflected.
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No registration or restriction for free and simple – works on mobile and desktop.
Services such as the one offered by thetopstockbroker enables you to easily convert a fund's buy value with the current value into the annual return so that you can assess performance without having to create a spreadsheet. It can also be used as a learning tool: by varying the input, you can easily see how the amount, tenure and growth will be interacting.
Things to Keep in Mind While Calculating Returns
Compare on CAGR or XIRR
Always use annualised returns, never use absolute returns. If the investment has been made in a SIP with multiple SIP instalments, the CAGR would not be a true representation of the investment as each SIP instalment has been invested for a different period of time, and that's where the XIRR comes in.
Exit Load and Expense Ratio
See if the value that you have is before or after the charges. If you withdraw too early, it will be considered exit load, and the expense ratio subtly drags down returns annually. See what you would get, using the post-charge value.
Taxes
Capital gain taxes may vary according to the type of fund and the length of time that was held, and rules may change. Always check current tax laws before redeeming as tax will take up your take-home return.
Past Performance
A calculator only tells you what has already occurred, not what will occur. Think of the results as an informed guess, and talk to a competent financial adviser for larger purchases.
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