Total Shareholder Return (TSR)
Total Shareholder Return (TSR)
Annualized holding-period return with dividends accumulated as cash: terminal wealth is ending share price plus total cash dividends. This excludes dividend reinvestment and additional purchases or withdrawals.
When to use: Use to annualize a single investment with dividends held as cash. Reported total shareholder return often assumes reinvestment and requires a different cash-flow history.
Formula
Variables
| Symbol | Name | Description | Unit |
|---|---|---|---|
| TSR | Total Shareholder Return | Total annualized return including price change and dividends, as a decimal | % |
| Dividends | Dividends Received | Total dividends received over the holding period | $ |
| n | Holding Period | Years held before exit | years |
| P0 | Beginning Share Price | Price at the start of the full holding period | $ |
| P1 | Ending Share Price | Price at the end of the full holding period | $ |
Real-Life Examples
Example 1: 5-Year Hold
Bought at $50, sold 5 years later at $80, received $10 of total dividends along the way.
Given
Step-by-Step
Annualized holding-period return is 12.4746%, with dividends held as cash and no reinvestment.
Frequently Asked Questions
No. Dividends are added as cash at the end. Reinvested TSR requires the prices and dates of reinvestment; reinvestment can raise or lower the return depending on subsequent performance.
Use the complete holding period in years and prices on a consistent split-adjusted basis. Additional contributions require a money-weighted or time-weighted method.