Portfolio Return Calculator
Portfolio is a collection of investments held by an institution or a private individual. This tool calculates the return on the assets.
About the Portfolio Return Calculator
Calculate the expected return of an investment portfolio of three assets from the return of each asset and its weight in the portfolio (as a percentage of the total).
How it is calculated
Portfolio return = w1 × R1 + w2 × R2 + w3 × R3
The expected return of a portfolio is the weighted average of the returns of its assets. The weights are the share of the money invested in each asset and should add up to 100%.
Example
With 50% in stocks returning 8%, 30% in bonds returning 4% and 20% in cash returning 2%, the portfolio return is 0.5 × 8 + 0.3 × 4 + 0.2 × 2 = 5.6%.
Frequently asked questions
Do the weights have to add up to 100%?
Yes, they represent how the whole investment is split between the assets.
Does this measure risk?
No, it gives the expected return only. Portfolio risk also depends on how the assets move together (correlation).
Which returns should I use?
Expected future returns; historical averages are a common, but not guaranteed, starting point.