A common misconception for investors is not being aware of price and total return, along with the difference between the two. This can lead to confusion over historic returns when an investor sees a chart, or a quoted price, and it’s only factoring in the price change.
Quite often the media, either aware or not, will use price returns, which will add to the misinformation, leaving investors believing returns have been lower than they are. The price vs total return issues extends beyond indexes to stock prices and ETFs. Google is a common place to search for an ETF or stock code and the charts returned by google only show the price changes.
In an attempt to address this problem, Mark Hebner of ifa.com has launched a petition to persuade the media to change their ways and start reporting total returns as standard.
Sign Mark’s petition at http://www.ifa.com/petition
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