Investing - Total versus Annual Returns

[This post is written and copyrighted by FIRE Finance (http://firefinance.blogspot.com).]

Jun 28, 2010: While studying the performance of a stock or mutual fund we invariably come across these two terms - Total (also called Cumulative) and Annual return. If we are not aware of their definitions and what they represent, we may get unduly excited by looking at the wrong figures.

Annual Return -