From which date are the mutual fund returns calculated?

Zerodha Coin - Direct MF
1

From which date are the mutual fund returns calculated?

Can someone please explain how are the returns calculated? Many sites show different data for different time durations.
The 1 year return is from which year?? Suppose I check the 1 year return today, will the returns be shown for the period 9 April 2024 to 9th April 2025?

  1. How are the returns calculated? and why are the returns different on different sites?
  2. Which site shows the correct data?
  3. Why there is a big difference in SIP and lumpsum return? The lumpsum return is calculated from which day? If I check today, it will show data for lumpsum investment made on 9 April 2024 ?
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@ShubhS9 Any idea?

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++ @Heeru_Nisa

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Mutual fund returns are always calculated backward from the current date:

  • 1-year return: From exactly one year ago to today
  • Example: If checked on April 9, 2025, returns show performance from April 9, 2024 to April 9, 2025
  • This same principle applies to all time frames (3-year, 5-year, etc.)
  1. How are the returns calculated? and why are the returns different on different sites?

How are the returns calculated?

  • For periods less than 1 year: Absolute returns = [(Final NAV - Initial NAV) / Initial NAV] × 100 For example, if a fund’s NAV increased from ₹100 to ₹110 in 8 months, the absolute return would be [(110-100)/100] × 100 = 10%.

  • For periods more than 1 year: CAGR = [(Final NAV / Initial NAV)^(1/n) - 1] × 100 (where n = number of years) If your fund grew from ₹100 to ₹150 over 3 years, the CAGR would be [(150/100)^(1/3) - 1] × 100 = 14.47%. This is different from the absolute return because it shows the annualized growth rate.

  • For SIP investments: XIRR (Extended Internal Rate of Return) method is used, which considers:

  1. Different amounts invested at different times
  2. The current value of all units purchased
  3. The exact number of days each investment has been in the market

Why are returns different on different sites?

Returns vary across platforms due to:

  1. Different calculation methodologies (point-to-point vs. rolling returns)
  2. NAV update timing differences
  3. Dividend reinvestment handling variations
  4. Data refresh frequency differences
  1. Which site shows the correct data?

Most reliable sources:

  1. Official AMC websites
  2. AMFI website
  3. Reputable financial platforms with reliable data vendors

We use DION as our data vendor for mutual fund information, ensuring reliable and accurate returns data on our platform.

  1. Why there is a big difference in SIP and lumpsum return? The lumpsum return is calculated from which day? If I check today, it will show data for lumpsum investment made on 9 April 2024 ?

Why is there a big difference in SIP and lumpsum returns?

The difference exists because of:

  • Investment pattern differences:
    • Lumpsum: Single investment on one date
    • SIP: Multiple investments spread over time
  • Market impact:
    • Lumpsum: Fully exposed to market conditions on a single day
    • SIP: Benefits from rupee-cost averaging across different market conditions
  • Calculation methodology:
    • Lumpsum: Simple point-to-point growth calculation
    • SIP: Complex XIRR calculation considering multiple investment dates

How is lumpsum return calculated?

  • A 1-year lumpsum return checked today shows performance of an investment made exactly one year ago
  • It compares the NAV on that date with today’s NAV
  • It does NOT predict future performance for investments made today

For detailed examples with calculations, please refer to our support article here

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Thanks, very well explained

1 Like
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Different calculation methodologies (point-to-point vs. rolling returns)

Is there any way to find out which site is showing which returns? (point-to-point OR rolling returns)

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There are ways to figure out whether a website or platform is showing point-to-point returns or rolling returns:

Point-to-point returns:

Show performance between two specific dates
Example: “This fund returned 8.5% from January 1 to December 31, 2024”
Usually shows one number for each time period (1-year, 3-year, etc.)

Rolling returns:

Show average performance over many overlapping periods
Example: “The average 3-year return was 7.2% when measured across all possible 3-year periods”
Often shows a range or average of many different measurement periods