One post tagged with "compare"

Investment decisions are hard. Broadly, you have two choices: let someone else manage your money, or manage it yourself. If someone else does, you should at least benchmark their returns — we wrote about that here. If you do it yourself, you need to know how to compare your options before you can decide between them.

Comparing investment options is a broad topic, but an important part of it is comparing past performance. We will look at how charts help in comparing returns. Past performance is no guarantee, but it is one indicator of what might lie ahead.

So, how do you actually compare options? Judging by what most sites show, the usual answers are CAGR (over set periods like 1y, 3y, 5y) and the NAV chart. Both summarize past performance, and both are useful — but they're biased summaries, not the only way to look. The same performance reads differently from different angles. We'll walk through a few of those angles here, and build mental models so you're not lost in front of any benchmark.