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Performance values difference with Google Finance

HC
Hedge CatOctober 17, 23 | Posted in general
Google Finance shows that VTI gained 16.00% over the past year, but on PortfoliosLab, the value is 22.37%. Why is the difference so significant? I'd expect it to be relatively close, allowing for some margin of error. However, the current difference shows a gap of more than six percent.
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DS
Dmitry ShevchenkoOctober 23, 23

Their price numbers look correct, but it appears Google Finance is not accounting for dividends in its performance calculations. That results in a systematic undervaluation of assets that pay dividends, such as many ETFs and stocks. Dividends can make a substantial difference in the total return of an investment over time. This is why many investors usually prefer to look at total return figures that include both price appreciation and dividends

In a case like this, the performance numbers reported by Google Finance would be less reflective of the actual total returns you would experience as an investor. Depending on your investment strategy and goals, this could be a significant issue. If you rely solely on a platform that doesn't account for dividends, you could be underestimating your actual returns, which might lead to suboptimal investment decisions.


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