In short
- Simple return = gain ÷ amount invested.
- You need to add dividends and take away fees.
- Time matters: 20% in one year is not the same as 20% in five years.
A full calculation
Made-up example, for one share bought and then sold:
| Item | Amount |
|---|---|
| Purchase | 10,000 DH |
| Sale | 11,500 DH |
| Net dividends received | +300 DH |
| Buying and selling fees | −160 DH |
| Tax on the capital gain | −201 DH |
| Net gain | 1,439 DH |
The capital gain after fees is 1,340 dirhams, and the made-up tax of 15% comes to 201 dirhams. The net return is 1,439 ÷ 10,000, or about 14.4%, compared with 15% if you only look at prices.
Taking time into account
Results over several years are easier to compare with an average annual return. Made-up example: 10,000 dirhams become 12,100 dirhams in two years. The total gain is 21%, but the average annual return is 10%, because 10,000 × 1.10 × 1.10 = 12,100.
Comparing with an index
To put a result in context, you can compare it with the MASI over the same period. Keep two points in mind:
- A price index does not include dividends, unlike total return indices.
- Risk: two identical results can hide very different risks.
The deposit trap
If you add money along the way, the balance grows without this being a gain. Made-up example: a portfolio goes from 10,000 to 16,000 dirhams after a 5,000-dirham deposit. The real gain is 1,000 dirhams, not 6,000. A precise measure then depends on the dates of the deposits.
Past performance does not guarantee future performance.
Frequently asked questions
Is the performance shown by my platform accurate?
It depends on its method. Check whether it includes fees, dividends and deposits.
Should I count inflation?
To measure buying power, yes. A 5% gain with 2% inflation is a real gain of about 3%.
This article is for information and educational purposes only. It is not investment advice or a recommendation to buy or sell any security. Investing in shares involves a risk of capital loss. Check figures against official sources (Casablanca Stock Exchange, AMMC) and consult a licensed professional. Read the full disclaimer.
