Portfolio Expected Return Calculator
Combine the weights and expected returns of up to three holdings into a single weighted-average expected return for the whole portfolio.
How it works
Expected return = Σ(weightᵢ × returnᵢ) ÷ Σ(weightᵢ)
A portfolio’s expected return is just the weighted average of the expected returns of the things inside it, with each weight being that holding’s share of the money. Unlike risk, expected return does not benefit from diversification — you cannot combine assets to earn more than the weighted average of their returns. If your weights do not sum to 100%, the calculator normalises them so the answer stays meaningful.
Worked example
A portfolio is 50% in a 9% asset, 30% in a 5% asset and 20% in a 2% asset. Expected return = 0.50 × 9 + 0.30 × 5 + 0.20 × 2 = 4.5 + 1.5 + 0.4 = 6.4%.
Frequently asked questions
Do the weights need to add up to 100%?
Ideally yes, but if they do not the calculator normalises them by dividing by their sum. That keeps the weighted average correct even with a rough set of weights.
Why does expected return not improve with diversification?
Diversification lowers risk by combining assets whose ups and downs partly cancel, but return is a simple weighted average — mixing assets can never lift it above the best of them or below the worst.
Where do the expected returns come from?
They are your own estimates — from historical averages, analyst forecasts or a model. The output is only as good as those inputs, so treat it as a planning tool, not a promise.
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Educational estimate, not investment advice. Past returns do not predict future results.