How to Track Portfolio Performance the Right Way

If your portfolio tracker only shows a single "profit" number, you are almost certainly measuring performance wrong. The figure most brokers display blends two very different things: how your investments actually did, and how much money you happened to add along the way. A proper portfolio performance tracker separates those, and the gap between them is often larger than people expect.

Here is the short version. To know how good your investments are, you want time-weighted return (TWR). To know how good you have been as an investor, you want money-weighted return, usually calculated as XIRR. Most retail investors, especially Degiro users, never see either. They see a distorted middle number and draw the wrong conclusions from it.

Let's fix that.

Why your broker's return number lies to you

Say you started the year with €10,000 invested. By June your holdings had drifted up to €10,500, a modest 5%. Feeling good, you deposited another €10,000 in July. The market then had a rough second half, and everything dropped 8%.

Open your broker app in December and you might see a total value around €18,860 against €20,000 you put in, showing a loss. Or, depending on how the app calculates it, you might see a small "profit" because your early holdings are still above their cost. Neither number tells you how your investments performed, because both are contaminated by the €10,000 you added in the middle of the year.

This is the core problem. Deposits and withdrawals distort any simple gain calculation. The more you contribute, the more misleading a raw profit figure becomes. And retail investors contribute constantly, monthly buys, the occasional lump sum, reinvested dividends. If you track your Degiro portfolio's performance using the native overview alone, you are reading a number that mixes your saving behaviour with your market results.

Time-weighted return: judging the investments

Time-weighted return answers one question: how did your portfolio perform, ignoring when you added or removed money?

It does this by chopping your timeline into periods around each cash flow, calculating the return of each period, then linking them together. Because every contribution starts a fresh period, the size and timing of your deposits stop mattering. What remains is the pure performance of the assets you held.

That property is exactly why the finance industry uses TWR to measure fund managers. A manager cannot control when clients deposit money, so it would be unfair to judge them on it. TWR strips that out. For you, it means one thing above all: TWR is the only honest way to compare yourself to a benchmark like the MSCI World or S&P 500.

If your TWR for the year is 6% and the MSCI World returned 11%, you underperformed, full stop. Your deposit schedule is irrelevant to that comparison. This is the number to watch if you are trying to figure out whether your stock-picking is beating a simple index fund, and for many people the uncomfortable answer is that it is not.

Money-weighted return (XIRR): judging yourself

Money-weighted return, which retail tools calculate as XIRR, answers a different and more personal question: what annual rate did your actual euros earn, given exactly when you invested them?

Unlike TWR, XIRR cares deeply about timing. If you happened to pour a large deposit in right before a rally, your XIRR will beat your TWR, because your money was working hard at the right moment. If you bought heavily at the top before a slump, XIRR will trail TWR. The spread between the two numbers is a scorecard for your timing.

XIRR is the same thing spreadsheets call the internal rate of return for irregular cash flows. It takes a list of dated transactions (money out when you buy, money in when you sell or collect a dividend) plus today's portfolio value, and solves for the single annual return that makes them balance. According to Investopedia's breakdown of money-weighted return, this is the figure that best reflects an individual investor's real experience.

For most people tracking their own money, XIRR is the more useful everyday number. It is your true annualised return, dividends and timing included. TWR is the number you pull out when you want to compare against an index.

TWR vs XIRR at a glance

Notice that neither of these is the number your broker shows by default. That number, a raw sum of gains across current positions, is distorted by big deposits and belongs in neither column.

How to actually calculate both

You have three realistic options, in rising order of convenience.

1. Do it in a spreadsheet. Export your transaction history, list every cash flow with its date as a negative (buys) or positive (sells, dividends), add today's total value as a final positive line, and run =XIRR(values, dates). Google Sheets and Excel both support it. This gives you money-weighted return in about ten minutes. TWR is harder to build by hand because you need a portfolio valuation at every cash-flow date, which a spreadsheet cannot pull automatically.

2. Use Degiro's export plus manual work. Degiro lets you download a CSV of your transactions. From there you are back in spreadsheet territory, with the added pain of matching dividends, fees, and currency conversions by hand. Plenty of investors do this, and plenty of them quietly give up on spreadsheets once the portfolio passes twenty positions and the formulas start breaking.

3. Use a portfolio performance tracker that computes both automatically. You import your Degiro CSV once, and the tool values your holdings at every historical date, folds in dividends, handles the euro-dollar conversions, and shows TWR and XIRR side by side. No formulas to maintain, no valuation snapshots to capture manually. This is the whole reason dedicated trackers exist.

If you are setting one up for the first time, our guide on how to track a Degiro portfolio in 2026 walks through the import step by step.

The currency trap European investors keep missing

There is a fourth number hiding inside your returns, and it catches European investors more than anyone: currency.

If you hold US stocks through Degiro, your positions are priced in dollars but your account thinks in euros. A year where your US holdings rose 10% in dollar terms but the dollar weakened 8% against the euro leaves you with a real gain of roughly 2% once converted. A performance tracker worth using converts each transaction at its historical rate and shows how much of your return came from the market versus the exchange rate. We went deep on this in our piece on how EUR/USD moves quietly reshape your returns.

A spreadsheet XIRR that ignores currency will simply be wrong for a multi-currency portfolio. This is one of the clearest cases where a proper tracker earns its keep.

What good performance measurement looks like in practice

Once you have both numbers, a healthy habit is to check them together, roughly monthly, not daily. Here is how to read them.

• TWR near your benchmark, XIRR higher than TWR: your investments matched the market and your timing helped. Solid.
• TWR below your benchmark: your stock selection is lagging an index. Consider whether a low-cost ETF would serve you better.
• XIRR well below TWR: the market did fine, but your timing hurt. You may be buying tops and sitting out dips.
• Both strongly negative in a flat market: dig into fees and currency drag, which quietly erode returns and rarely show up in the headline number.

The point of a portfolio performance tracker is not to give you one comforting figure. It is to give you the two honest ones that, read side by side, tell you what to change.

If you want to see your own TWR and XIRR without touching a spreadsheet, import your Degiro CSV into Zune.Money's Degiro portfolio tracker. It takes about three minutes, the core tracking is free, and you will finally see the two numbers that actually matter instead of the one that does not.

Frequently asked questions

Is XIRR the same as CAGR? No. CAGR assumes a single lump sum grew at a steady rate with no further deposits. XIRR handles many contributions and withdrawals on their exact dates, which is what real portfolios look like. Use CAGR for a one-off investment, XIRR for an ongoing one.

How often should I check my portfolio performance? Monthly is plenty for a long-term investor. Daily checking tempts you into reacting to noise and timing the market, which is precisely the behaviour that drags XIRR below TWR. Set a monthly reminder and ignore it in between.

Does dividend reinvestment affect these returns? Yes, and both metrics should capture it. Reinvested dividends count as a return you earned, so a proper tracker treats each payout as income and each reinvestment purchase as a cash flow. If your calculation ignores dividends, both your TWR and XIRR will understate reality.