What is 'total return'? Definition & meaning

This is the measurement of a fund’s performance in a specific period.

Total return encompasses dividends, capital gains, interest, and distributions realised. It should also deduct any fees and costs associated with holding the fund.

It is expressed as a percentage of the initial investment.

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More terms

DMO

The United Kingdom Debt Management Office. It’s an executive agency responsible for managing the government’s debt and cash needs, primarily through issuing gilts and Treasury bills.

Unit Trusts

A collective investment scheme the investors pay money into in exchange for units. The money is invested in a diversified portfolio of assets.

Retail Prices Index (RPI)

An index published each month by the Office for National Statistics, which measures the level of retail prices in the UK. Cash flows on all index-linked gilts are linked to the RPI.

Over-The-Counter (OTC)

A security that is sold outside of an exchange.

S&P 500

Find out what is the definition of the S&P 500 index.

Float

Listing a company on a stock exchange, or the shares that are genuinely up for grabs once it’s there.

Junk Bond

A form of debt investment that carries higher risk because of the likelihood that the issuer will default.

Equity ETF

An exchange-traded fund that is comprised of a set of stocks.

Money laundering

A method of moving money obtained illicitly through the financial system so it can be used legally.

Total Return