Net Worth Change vs Investment Return

Separate balances, contributions, debt changes, distributions and price changes before calling an increase investment performance.

A balance sheet measures a point in time

Net worth is the value of assets less liabilities at a chosen date. It can include cash, property and debt as well as market investments. A current snapshot answers what the entered records add up to; it does not explain every event since the previous snapshot or identify the return on invested capital.

A contribution changes the amount being measured

Depositing savings increases an investment account without requiring a market gain. Paying a liability can change both cash and debt. Spending, income, new borrowing and asset revaluations also affect net worth. Before interpreting a change, keep the same reporting scope and record known flows separately.

A residual is not automatically a return

Our history sheet displays change less entered contributions and withdrawals. That arithmetic can help review unexplained differences, but it does not isolate investment performance. It can still contain debt movements, income, spending, property valuations and omitted flows. The label deliberately avoids calling the result profit or return.

Unrealized change is a narrower measure

The holdings file subtracts entered remaining USD cost from current USD market value. This can show a useful price/currency difference on current positions. It does not include sold positions, income distributions or the timing of deposits. Comparing that figure with cost is not a time-weighted, money-weighted or annualized total return.

Income and reinvestment need their own records

A dividend receipt contributes to economic investment return, but recording the receipt alone does not calculate total return. If the cash is reinvested, current units may already reflect the purchase. Do not add the original cash receipt again to a holding value that includes those shares. Use source statements to identify the receipt and purchase separately.

Use records that preserve the boundary

Keep dated snapshots, source prices, FX quotes and a consistent asset/liability scope. Preserve past entries instead of allowing current prices to rewrite them. Reconcile important changes to statements. If the actual task is performance measurement across transactions and flows, use a method designed for that task rather than renaming a balance-sheet change.

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Definitions and primary sources

Investor.gov: Figure out your finances · Investor.gov: Asset allocation and rebalancing · FINRA: Return and rate of return · IRS: Dividends and distributions

Sources provide definition context. Workbook layouts, formulas and all examples are original AllMarkets material, not official agency templates or a tax/financial reporting certification. Sources checked 17 October 2026.