Point-to-Point Returns

Point-to-point returns measure the absolute percentage change in the value of an investment — such as a mutual fund's NAV — between two specific dates: the start date and the end date of the measurement period. Unlike rolling returns (which measure returns over a moving window) or CAGR (which annualises returns over multi-year periods), point-to-point returns simply show the total gain or loss between two fixed points in time. For example, a fund with an NAV of ₹100 on January 1, 2020 and ₹160 on January 1, 2025 would have a point-to-point return of 60% over five years. Point-to-point returns are straightforward to calculate but can be misleading as a performance measure because they are highly sensitive to the start and end dates chosen — a fund that underperformed for four years and rallied sharply in the fifth year may appear to have strong five-year point-to-point returns despite poor underlying performance.