Portfolio value
Your portfolio value is displayed in the menu bar, also known as the account value. This represents the total amount of all your securities, received dividends, and available cash, minus any associated costs.
In addition, we provide insights into your future portfolio value as a complement to your current value. For this purpose, we have developed a compound growth calculator so you can see what your portfolio value could be at the end of your investment horizon.
What does compound growth mean?
To estimate your future portfolio value, we look at the compound growth of your portfolio. Compound growth is also known as the interest-on-interest effect. This means that you earn interest on the gains and interest you have accumulated over time, leading to exponential growth of your assets.
How do we calculate your future portfolio value?
We calculate your future portfolio value based on your previous actions with your broker. We use the CAGR (Compound Annual Growth Rate) of your portfolio as the growth rate and calculate your average monthly contribution based on your broker deposits. These values can be adjusted according to your personal preferences.
For realistic growth we look at the absolute CAGR, which is calculated differently than the standard MWRR CAGR (Money-Weighted Rate of Return). Based on your performance calculation the CAGR values could therefore differ. Read the calculation differences under Absolute vs MWRR CAGR.
Your investment year starts from your very first broker transaction. To determine your future years, we consider your total investment horizon. The default setting is 30 years, but this value is also adjustable via the selector.
What formula is used?
To calculate the future portfolio value per year, we use two complex formulas. These two end values are added together for the total future portfolio value.
For the first formula, we look at the compound growth effect on your monthly contribution. We assume that it was invested at the beginning of the month.
A = PMT(((1 + r/n)^(nt) - 1) ÷ (r/n)) × (1+r/n) + P(1 + r/n)nt + (...)
| A | Future portfolio value |
| PMT | Monthly deposits |
| r | Your absolute CAGR |
| n | How many times your contributions compound each year (we use 12 months) |
| t | Future investment year |
For the second formula, we look at the compound growth effect on your already built portfolio value.
A = (...) + P(1 + r/n)nt
| P | Starting value (current portfolio value) |