A return figure can be true and still mislead you. The number your broker shows is the nominal return. The number that tells you whether you are better off is the real return. Here is the difference, and the second layer that matters when you invest in another currency.
Nominal return is the raw gain
Nominal return is the change in an investment's value, measured in money. Put in 10,000 and it is worth 12,000 today, and you are up 20 percent. That figure is correct, but it leaves out one thing: what that money can buy has changed too.
Real return is what is left after inflation
Real return is your gain after inflation. It answers a simple question: how much more can you buy with the money now than you could when you invested? If prices rose 12 percent while your investment rose 20 percent, your buying power grew by about 7 percent, not 20.
The exact way to work it out: divide one plus your return by one plus inflation, then subtract one. With the numbers above, 1.20 divided by 1.12 is 1.071, so the real return is 7.1 percent. Subtracting inflation from the return (20 minus 12 is 8) is a fair shortcut when both numbers are small, and a badly wrong one when they are large.
The second layer: currency
If you invest in one currency and live in another, there is a second gap between the headline number and what you really made. The return in the fund's own currency is not your return. Yours is the return in your currency, converted at the exchange rate of the day you invested and the rate today, and then the inflation of your currency on top.
A real example
Put 10,000 dollars into an S&P 500 fund on 3 January 2023. Counting the price alone, before dividends, by mid-September 2026 it was worth about 19,800 dollars: up 98 percent in dollars. Prices in the United States rose 12 percent between January 2023 and August 2026, the latest month published, so the real return in dollars was about 77 percent.
Now read the same investment in Turkish lira. Because the lira fell against the dollar, it is up 414 percent in lira. That looks enormous, but prices in Türkiye rose 256 percent over the same months, so the money buys about 44 percent more than when it was invested. Same fund, same dates: 98, 77, 414 and 44 percent are all true answers to different questions, and only the real return in the currency you live in tells you how much better off you are.
Work it out for your own investment
The real return calculator does both steps for one investment. Pick what you bought, enter what you put in and when, and choose the currency you live in. It finds what the investment is worth today with dividends, converts at the exchange rate of each date, applies that currency's official inflation, and shows where the figure comes from.
How StockFly does it for you
StockFly values every historical cash flow at the exchange rate on its own date, across your whole portfolio. So your cost basis, your gains, and your dividends are the true figures in your currency, shown in whatever currency you choose, without you doing a single conversion by hand. See how the multi-currency tracker works.
This is general information, not investment advice.