Overview
When you compare the annual capital gain in Navexa to the sum of monthly capital gains, you may notice a difference. Sometimes this is just a few dollars, but in years with more trading activity, dividends, or FX changes, it can be larger.
Both sets of numbers are correct. The difference comes down to calculation method and rounding.
How Annual vs Monthly Calculations Differ
Annual figure: Calculated as one continuous performance measure across the entire tax year. This method compounds changes and avoids intermediate rounding.
Monthly figures: Each month is calculated separately, rounded to cents, and then treated as a snapshot. Adding them together means you are summing already-rounded monthly results.
Example (Simulated)
To illustrate the difference clearly, here is a clean simulated example:
Opening balance: $100,000
Closing balance after one year (continuous calculation): $112,500
Annual capital gain (continuous): $12,500
Sum of monthly gains (after rounding each month): $12,460
Difference: $40
Month | Rounded Monthly Gain ($) | End of Month Value (rounded path) | End of Month Value (continuous) |
July | 1,020 | 101,020 | 101,020.55 |
August | 980 | 102,000 | 102,001.10 |
September | -650 | 101,350 | 101,351.55 |
October | -720 | 100,630 | 100,632.20 |
November | 1,150 | 101,780 | 101,782.65 |
December | 1,270 | 103,050 | 103,053.40 |
January | 1,430 | 104,480 | 104,483.25 |
February | 960 | 105,440 | 105,443.70 |
March | 1,220 | 106,660 | 106,664.55 |
April | 890 | 107,550 | 107,552.40 |
May | 1,500 | 109,050 | 109,054.85 |
June | 1,480 | 110,530 | 110,534.10 |
Closing Balance | – | 110,530 | 112,500 |
Total | 12,460 | – | 12,500 |
This example shows how the annual figure (continuous calculation) gives the exact performance outcome, while the monthly sum drifts due to rounding each month.
The $40 gap here is for demonstration, but in real portfolios the difference can be a few dollars in quiet years or hundreds in busier ones.
Why This Matters
Monthly totals are useful for tracking short-term performance.
Annual totals are the most precise measure of your portfolio’s performance across the full year.
If you need to report or compare results for a full tax year, always rely on the annual capital gain figure.
Key Takeaway
Differences between monthly and annual totals come from rounding and calculation methods. Both are valid, but the annual figure is the most accurate representation of overall performance.