Demystify your investments! Learn the secrets behind those percentage figures and make smarter financial decisions. A beginner's guide for India.
Simple total gain/loss over an investment period. Perfect for investments held less than a year. Example: ₹50k to ₹60k in 10 months = 20% absolute return. Easy!
Compounded Annual Growth Rate. For investments over 1 year, it shows average annual growth, assuming reinvestment. Essential for comparing long-term performance meaningfully.
Systematic Investment Plans (SIPs) involve multiple investments over time. CAGR won't cut it! XIRR (Extended Internal Rate of Return) accurately annualizes returns for multiple cash flows.
Expense Ratio (fund fee, deducted), Exit Load (early withdrawal fee), Taxation (STCG, LTCG vary), Dividends (payouts or reinvestment). All impact your final take-home.
Don't compare absolute vs. annualised. Past performance ≠ future returns. Focus on long-term goals, not short-term market noise. Understand XIRR for your SIPs!
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