Comments on: Mutual Fund Return Lies: Average Annual Return vs Compound Annual Growth Rate

By: Jerry Okamura

Jerry Okamura — Mon, 27 Feb 2012 22:43:14 +0000

Since the vast majority of people who put their money in a mutual fund, do so with every paycheck. What is their average rate of return, then?

By: Anthony Teamson

Anthony Teamson — Thu, 20 Jan 2011 18:22:55 +0000

Anonymou above gives a non-answer. All he says is that the SEC has a method, but does not say what that method is. Post the formula.

By: Rene Culler

Rene Culler — Fri, 14 May 2010 19:47:25 +0000

The info can be from years before.

By: rajesh ruparel

rajesh ruparel — Sat, 07 Nov 2009 13:49:47 +0000

i invested $50,000 in 1995 in S&P 500 index fund, when S&P was 600. now in 2009 after 14yrs the balance in my fund is only 35,000. whereas S&P is right now at 950 something. what happened to my funds. i thought it would have become 75,000.or more. where did they or S&P lie

By: Anonymous

Anonymous — Fri, 11 Sep 2009 20:09:41 +0000

Not true. In the 1990′s you would’ve been right about your assumptions. A lot of funds calculated returns in various ways, including arithmetic mean. However, since the late 90s, Mutual funds are required to use a calculation for returns that has been set forth by the SEC. This is a total return formula that assumes all dividends and interest are reinvested. It is not complicated but is far from a simple arithmetic average.