Calculating your DEGIRO return: MWRR and CAGR explained

DEGIRO's own return figure doesn't account for when you deposited money; MWRR (Money-Weighted Rate of Return) corrects for this and shows the annual return you actually made on the money you invested, while CAGR only applies to an amount without interim deposits or withdrawals.

Why “ending value minus contributions” distorts your return

Most investors calculate their return like this: (ending value − total contributions) ÷ total contributions. That works fine as long as you deposit exactly once and never touch it again. As soon as you add money along the way — which most people do — this number stops being accurate, because it doesn’t account for when that money was deposited. Bluntly put, the figure DEGIRO shows by default is little more than an educated guess once you’ve deposited more than once.

An example makes this concrete.

Worked example: same year, two very different returns

You deposit €10,000 on 1 January. On 1 July you add another €10,000. On 31 December your portfolio stands at €22,000.

The simple calculation:

(22,000 − 20,000) ÷ 20,000 = 10%

That seems clear, but it’s misleading: the second €10,000 only participated for half a year, yet still contributed to that €2,000 gain. Your money actually grew faster than 10% per year.

The correct calculation (MWRR):

Money-Weighted Rate of Return accounts for the timing of every deposit — it’s effectively the internal rate of return (IRR) of your cashflows. For this example that’s an annual return of roughly 13.5%, not 10%. The 3.5 percentage point difference comes entirely from the second deposit being invested for a shorter period.

Keep in mind that the return you see is after costs: transaction and connection fees lower it directly, see the DEGIRO fees overview, and the more often you trade, the more they add up, see portfolio turnover ratio.

What exactly is MWRR?

What did my money actually do for me? That’s the question MWRR answers. MWRR is the annual return you actually made on the money you invested, given when you invested or withdrew it — unlike Time-Weighted Return (TWR), which filters out the effect of your own deposit timing in order to judge the performance of a fund or strategy independently of when you got in.

Rule of thumb: the larger and later your deposits are relative to your total contributions, the more your MWRR will diverge from the TWR of the underlying investment — with a single lump-sum deposit, the two coincide.

Did you also withdraw money along the way — say, taking profit before a correction? That withdrawal counts as a negative cashflow in the IRR calculation, and can actually push your MWRR notably higher than your “gut feel” about the portfolio would suggest.

For an individual retail investor who decides for themselves when to deposit, MWRR is usually the most relevant metric: it’s your return, including your own timing. Whether that return beats the market is a separate question: see benchmarking your portfolio against the S&P 500 or MSCI World, and alpha, beta and R² to tell skill from extra market risk.

MWRR vs. CAGR: what’s the difference?

CAGR (Compound Annual Growth Rate) answers a different question: “at what constant percentage per year did an amount grow, from starting to ending value?” The formula:

CAGR = (ending value ÷ starting value)^(1 ÷ number of years) − 1

CAGR is meant for an amount without interim deposits or withdrawals — for example, the return on a single lump-sum investment over several years. If you deposit €10,000 and it’s worth €16,000 three years later, your CAGR is:

(16,000 ÷ 10,000)^(1/3) − 1 ≈ 17%

As soon as you deposit or withdraw money along the way, “CAGR” on your whole portfolio no longer has a single clear meaning — that’s when you need MWRR instead. Both numbers are useful, but they answer different questions. The same calculation method, incidentally, also shows up for dividend growth instead of portfolio value — see dividend CAGR for how that works.

MWRR vs. CAGR vs. TWR: when to use which

In short: use MWRR when you want to know what your money earned, including the timing of your deposits. CAGR is enough if you invested once and never added or withdrew anything. Use TWR to compare a fund or strategy with an index, independent of when you got in. How TWR and MWRR differ, with a worked example on real prices, is covered in TWR vs MWRR: time-weighted or money-weighted return. Which tool shows which return is in the comparison of DEGIRO portfolio trackers.

Your total return is the sum of its parts: return contribution per position shows which holdings drove it, portfolio time travel shows what your portfolio was worth on any past date, and a what-if analysis of sold positions shows what holding on would have earned you.

How ClearAnalyser calculates this for you

ClearAnalyser calculates MWRR and CAGR automatically and live from your DEGIRO portfolio, including every deposit, withdrawal, currency effect and dividend payout — without you having to export or recalculate anything yourself. For your total portfolio as well as per individual position.

Sources: CFA Institute — Global Investment Performance Standards (GIPS)