How do you calculate weighted portfolio return?

Weighted Portfolio Return = Σ (Holding Value / Total Portfolio Value) × Holding Return%. Each position's weight is its dollar value as a percentage of the total portfolio. Multiply each weight by the holding's individual return, then sum all products. For example, a $6,000 holding at +20% and a $4,000 holding at +5% in a $10,000 portfolio gives: (60% × 20%) + (40% × 5%) = 12% + 2% = 14% weighted return.

What is the Sharpe ratio and what is a good Sharpe ratio?

Sharpe Ratio = (Portfolio Return − Risk-Free Rate) / Standard Deviation. It measures how much return you earn per unit of risk taken. A Sharpe ratio above 1.0 is considered good; above 2.0 is excellent. Below 0.5 indicates poor risk-adjusted returns; below 0 means the portfolio earned less than the risk-free rate on a risk-adjusted basis. Our Performance tab calculates and rates your Sharpe ratio automatically.

How often should you rebalance your portfolio?

Most financial planners recommend rebalancing when any asset class drifts more than 5 percentage points from its target allocation. The Rebalancing tab shows your drift score — if it exceeds 10-15%, rebalancing is recommended. Time-based rebalancing (quarterly or annually) is an alternative for tax-efficient accounts. The Rebalancing tab calculates the exact dollar amounts to buy and sell for each asset to restore target weights.

What is alpha in portfolio management?

Alpha is the excess annual return your portfolio generates above a benchmark index. If your portfolio returns 14%/yr and the S&P 500 returns 10%/yr, your alpha is +4%/yr. Over 10 years on a $50,000 portfolio, 4% annual alpha compounds to over $100,000 in additional wealth compared to the benchmark. The vs Benchmark tab calculates exact alpha and dollar advantage for any holding period.

What is the Information Ratio?

The Information Ratio = Alpha / Tracking Error (or portfolio standard deviation as a proxy). It measures how consistently your portfolio generates alpha relative to its variability. An Information Ratio above 0.5 is considered good; above 1.0 is excellent. It is similar to the Sharpe ratio but focused specifically on outperformance of a benchmark rather than the risk-free rate.

Is this portfolio return calculator free?

Yes. The Portfolio Return Calculator Pro on StockToolHub is completely free with no registration or account required.

Portfolio Return Calculator Pro — Weighted Return, Rebalancing & Performance

Your Holdings

Ticker / Name	Value ($)	Return (%)	Weight	Contribution

Weighted Portfolio Return

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Add holdings to calculate

Total Portfolio Value

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Total Gain / Loss

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Best Performer

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Worst Performer

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Portfolio Allocation

Holdings & Target Allocation

Asset	Current Value ($)	Current Weight	Target Weight (%)	Action Needed

Portfolio Drift Score

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Total Portfolio Value

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Target Weights Sum

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Assets to Buy

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Assets to Sell

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Current vs Target Allocation

What each tab calculates

Portfolio Builder

Add unlimited holdings with current value and individual return. Automatically calculates weighted portfolio return, total gain/loss, allocation weights, each holding's return contribution, and a portfolio donut chart.

Performance Analysis

Enter annual portfolio returns across multiple years. Calculates geometric CAGR, arithmetic mean, standard deviation (risk), Sharpe ratio with risk-free rate, best and worst year, and cumulative total return.

Rebalancing

Enter current holding values and target allocation percentages. Shows portfolio drift, exact dollar amounts to buy or sell for each asset to restore target weights, and a current vs target comparison chart.

vs Benchmark

Compare your portfolio CAGR against S&P 500, NASDAQ-100, MSCI World, 60/40, or a custom rate. Shows alpha per year, dollar advantage on your capital, and Information Ratio over the selected period.