Answer your questions about investment returns, dividends, and comparisons
How it works
What aspects of performance should I view besides market returns?
It’s important to consider that, while the time-weighted return may be the most helpful type of return figure to use when evaluating your portfolio manager, there are many other factors you should consider when evaluating your portfolio manager. Taxes saved now or at withdrawal from our services like TaxMin, Tax Loss Harvesting+, or Asset Location aren’t reflected in pre-tax returns. Also, you should not expect your time-weighted return over a short time horizon to be representative of the ...Read More
Types of returns
What is an individual rate of return?
The individual rate of return (or IRR) is a return number that includes the impact of the size and timing of your deposits and withdrawals. Since it includes the impact of your deposits and withdrawals, it may not reflect how well Betterment is managing your money. For that, you’ll want to refer to Time-Weighted Return (or TWR) which you can see in your “Portfolio returns.” Your Portfolio Returns (Time Weighted) Individual Rate of Return (Money-Weighted) Includes impact of portfolio returns ✅ ...Read More
What are time-weighted returns?
When people look at their returns, one goal is to understand how well Betterment is managing their money. If you want to judge how well Betterment has built your portfolio, the time-weighted return (TWR) is a useful figure to use. When you log into your Betterment account from a web browser and go to the Performance section, select one of your investment accounts from the Filter, and once the page reloads, you’ll see your “Portfolio returns” section beneath the balance information. If you’re ...Read More
What are money-weighted returns?
Money-weighted returns are affected by every cash flow that goes in and out of your portfolio. Cash flows at Betterment include deposits, withdrawals, dividends, and fees. We focus on the main type of money-weighted returns: internal rate of return (IRR). When you log into your Betterment account from a web browser and go to the Performance section, in the bottom left corner you’ll see your “Individual rate of return,” a type of money-weighted return. If you’re logged in on the mobile app, tap ...Read More