Learn / Understanding investing
Comparing yourself to the market
Am I doing better than buying an index?
Video coming soon
In this lesson
- A benchmark shows what you would have earned with the index. Imagine you had simply bought the index. Beating it is the real test of your choices.
- Both lines start at the same point. Where your line is above the index, your choices added something. Where it is below, the index would have been easier and better.
- As a euro investor, you leave the exchange-rate effect on. The S&P 500 is in dollars and your account is in euros. With the effect on, you see what you would really have earned in euros.
The example: the portfolio against the S&P 500
You choose the S&P 500, and Rendity starts your portfolio and the index at the same point. Then you try the NASDAQ 100, the DAX and a custom ticker such as VT. The comparison that tells you most is the one with what you would really have bought instead.
Then you change the time frame, for example to 2025. The answer can change with the period, so you look at more than one.
The account is in euros, the S&P 500 is in dollars. In 2025 the euro rose from about 1.04 to 1.17 dollars. For a euro investor that took a real bite out of US returns. You turn “Include exchange-rate effect” off and on again and watch the index line change.
Sample account, not real data, not investment advice.
Where to find it in Rendity
On the Comparison page you choose the index, for example S&P 500, NASDAQ 100, DAX or a custom ticker. There you also set the time frame and turn “Include exchange-rate effect” on or off. A custom ticker is always shown in its own currency.
Included inSeed Sprout Tree Orchard
Terms from this lesson
Education only, not investment advice. Tax topics are not tax advice.