Why Your XEQT Returns Don't Match the Internet (And Why That's Perfectly Normal)

I remember the exact moment it happened. It was a Sunday morning in January, and I had just finished reading one of those year-end investment roundup articles. The article said XEQT had returned roughly 10% for the year. Great. I had been buying XEQT all year. Time to check the damage — or in this case, the gains.

I opened my Wealthsimple app, navigated to my TFSA, and looked at my personal rate of return.

5.8%.

I stared at the number. I blinked. I closed the app and reopened it. Still 5.8%. I checked my RRSP. Similar story — my return was noticeably lower than what the internet was telling me XEQT had done.

My first thought was that something was broken. Maybe Wealthsimple was calculating it wrong. Maybe there was a glitch. Maybe I had accidentally bought a different ETF. I actually scrolled through my transaction history to triple-check that every purchase was in fact XEQT. It was.

My second thought was worse: maybe I was somehow doing it wrong. Maybe my timing was terrible. Maybe I was the one investor on earth who could underperform an index fund while literally buying that index fund.

It took me a solid hour of research to figure out what was going on. And once I understood it, I felt equal parts relieved and annoyed — relieved because nothing was wrong, and annoyed because nobody had ever explained this to me before. It is one of the most common sources of confusion for Canadian retail investors, and almost nobody talks about it clearly.

So let me be the one to explain it. If you have ever opened your brokerage account, seen a return that does not match what you read online, and felt that sinking feeling in your stomach, this post is for you. Nothing is broken. You are not doing it wrong. And your number is actually the one that matters most.

1. Two Ways to Measure the Same Thing

Here is the core of the issue: there are two fundamentally different ways to calculate investment returns, and they can produce wildly different numbers even when applied to the exact same fund over the exact same time period.

They are called time-weighted return (TWR) and money-weighted return (MWR), and understanding the difference between them will save you years of unnecessary anxiety.

Time-weighted return (TWR)

This is what fund companies, financial websites, and year-end performance articles report. When someone writes “XEQT returned 10% in 2025,” they are using the time-weighted return.

TWR measures the performance of the fund itself, completely ignoring when you personally put money in or took money out. It assumes a single lump sum was invested on day one and left untouched for the entire period. It strips out the effect of your individual cash flows.

Think of it as the fund’s report card. It answers the question: “How well did this investment perform?”

TWR is useful for comparing one fund to another. If XEQT returned 10% and VEQT returned 9.5% over the same period, TWR lets you make an apples-to-apples comparison of the funds themselves, regardless of how much money any particular investor added or withdrew.

Money-weighted return (MWR) / Personal rate of return

This is what your Wealthsimple dashboard shows you. It is also what most other Canadian brokerages report as your “personal rate of return.”

MWR measures your actual experience as an investor, taking into account when you deposited money, when you bought shares, and how much you invested at each point. It factors in the timing and size of every single cash flow.

Think of it as your personal report card. It answers the question: “How well did my money actually do?”

Both numbers are “correct.” They are just measuring different things. And in many cases — especially if you are dollar-cost averaging into XEQT by contributing monthly — they will produce different results.

2. A Tale of Two Investors

Let me make this concrete with an example. Imagine XEQT has a clean, steady year and returns exactly 10% from January 1 to December 31. Two investors both buy XEQT in a TFSA that year.

Investor A: The Lump Sum Investor

Investor A has $12,000 saved up from the previous year. On January 1, she invests the entire $12,000 in XEQT in one purchase. She does not add or withdraw anything for the rest of the year.

• Money invested: $12,000 on Jan 1
• Portfolio value on Dec 31: $13,200
• TWR: 10%
• MWR (personal return): 10%

For Investor A, both numbers match perfectly. She put all her money in at the start, the fund returned 10%, and her personal return is 10%. Simple.

Investor B: The Monthly Contributor

Investor B does not have $12,000 sitting around. Instead, she invests $1,000 per month throughout the year, every month from January to December. Same total investment of $12,000, same fund, same year.

• Money invested: $1,000/month x 12 months = $12,000
• Portfolio value on Dec 31: approximately $12,660
• TWR (of the fund): still 10%
• MWR (personal return): approximately 5.5%

Wait — Investor B also invested $12,000 in XEQT during a year when XEQT returned 10%, and her personal return is only 5.5%? How is that possible?

Because most of her money was not invested for most of the year. Her January contribution had the full 12 months to grow. Her February contribution had 11 months. Her March contribution had 10 months. And her December contribution? It only had a few weeks to do anything at all. On average, her money was invested for about 6.5 months, not 12. So her personal return reflects that shorter average exposure.

This is not a bug. It is not a mistake. It is basic math. And it is the single most common reason your personal return looks different from what you read online.

3. The DCA Timing Effect in Action

To really drive this home, here is a table showing how the timing of your contributions affects your personal return, even when the fund return stays the same. Assume XEQT returns 10% for the full year.

Every single one of these investors owned the same fund in the same year. The fund returned 10%. But their personal returns range from about 1% to 10%, depending entirely on when the money went in.

The investor who put everything in at the very beginning captures the full return. The investor who put everything in at the very end barely captures anything. And the monthly DCA investor — which is most of us — ends up somewhere in the middle.

This is completely normal. This is completely expected. And this is exactly what your Wealthsimple app is showing you.

4. What Your Wealthsimple Dashboard Is Actually Telling You

Let me get specific about what you see when you open Wealthsimple, because this is where most of the confusion lives.

When you tap on your account and see a return percentage, Wealthsimple is showing you a money-weighted return (MWR) — also called your “personal rate of return.” This number accounts for every deposit, every withdrawal, every purchase, and every dividend reinvestment, weighted by timing and amount.

This means:

• If you contributed heavily right before a dip, your MWR will look worse than the fund’s TWR
• If you happened to contribute heavily right before a rally, your MWR might actually look better than the fund’s TWR
• If you have been contributing steadily via dollar-cost averaging, your MWR will almost always be lower than the reported fund return during the first several years

Wealthsimple is not lying to you. It is not making a mistake. It is showing you the most honest and personally relevant number possible — the actual return your specific dollars experienced. If you want to dig deeper into how your account is performing over time, check out our guide on how to track your XEQT portfolio.

The dollar gain/loss figure (the actual dollar amount shown alongside the percentage) is also worth paying attention to. Sometimes a “5.5% return” feels disappointing until you realize it represents $3,400 in actual gains on money that was, on average, only invested for half the year. That is real money your money earned you while you went about your life.

5. Five Common Reasons Your Return Looks “Wrong”

Beyond the DCA timing effect, there are several other reasons your personal return in Wealthsimple might differ from what you see reported for XEQT online.

Reason 1: You are comparing different time periods

This sounds obvious, but it trips people up constantly. XEQT’s “annual return” is typically reported on a calendar-year basis (January 1 to December 31) or on a trailing basis (last 12 months from today). Your Wealthsimple return might be calculated from the date of your first purchase, which could be March 15 or August 2 or any other random date. Those are different periods covering different market conditions.

Reason 2: Dividend reinvestment timing

XEQT pays quarterly distributions. When those dividends land in your account, they sit as cash until you reinvest them (or until Wealthsimple’s DRIP reinvests them for you at the next purchase opportunity). That gap — even if it is only a few days — means your dividends were not invested during that window. Over time, these small timing differences add up and create a slight drag on your personal return compared to the fund’s reported return, which assumes immediate reinvestment.

Reason 3: Currency fluctuations in underlying holdings

XEQT holds global equities across multiple currencies — US dollars, euros, Japanese yen, British pounds, and more. The fund’s NAV (net asset value) is reported in Canadian dollars, but currency movements can cause your day-to-day returns to differ from the underlying equity performance. If the Canadian dollar strengthens against the US dollar, your international holdings are worth less in CAD terms, even if those stocks went up in their local currencies. This can create discrepancies between what you expect and what you see.

Reason 4: Buying during high or low periods

If you happened to start investing during a market peak, your personal return will look worse than the fund’s long-term average for a while. Conversely, if you started during a dip, your personal return might look stellar. Neither scenario says anything about the quality of XEQT as an investment — it only reflects your personal entry point.

Reason 5: The reporting lag

Fund fact sheets and financial websites sometimes report returns with a delay. The number you see in an article might reflect data as of the last month-end or even the last quarter-end, while your Wealthsimple return is updated daily. During volatile periods, even a few days of difference in the reporting date can mean significantly different numbers.

6. Why the Gap Shrinks Over Time (And Eventually Barely Matters)

Here is the genuinely reassuring part of this whole story: the gap between your personal return and the fund return gets smaller every single year.

Why? Because as your portfolio grows, your new contributions become a smaller and smaller percentage of your total balance. In your first year of investing, your monthly $500 contribution is a huge portion of your portfolio. By year ten, that same $500 is a rounding error compared to the $80,000 or $100,000 already invested.

Let me illustrate. Suppose you invest $500/month in XEQT and the fund returns a steady 8% per year:

By year 10, your $6,000 in annual contributions represents only about 7% of your total portfolio. The timing of those contributions has very little impact on your overall return. By year 20, it is barely 2%, and your personal return will be virtually indistinguishable from the fund return.

This is the natural arc of a long-term investor. Early on, your returns look “wrong” because DCA timing dominates the calculation. Over time, as compounding takes over and contributions shrink in relative importance, your personal return converges toward the fund’s return. It is not something you need to fix. It is something you need to wait out.

If you are curious about what your own numbers might look like over time, try running the scenarios through our calculator to see how contributions compound at different rates.

7. Your Personal Return Is the Only Number That Actually Matters

Here is where I want to flip the script entirely.

We have been talking about why your personal return is “lower” than the fund return as if that is a problem. It is not. In fact, I would argue that your personal return — the money-weighted return — is the only number you should care about.

Think about it. When you retire and start withdrawing from your TFSA or RRSP, you are not going to spend the “time-weighted return.” You are going to spend actual dollars. And those actual dollars grew at your personal rate of return, factoring in every contribution you made, every dip you bought through, and every year of patient compounding.

The fund return is an abstraction. It tells you how the fund performed in a vacuum. Your personal return tells you how your money performed in reality. One is a theoretical benchmark. The other is your actual financial life.

So when you see a blog post or a Reddit comment saying “XEQT returned 10% last year” and your Wealthsimple says 6%, here is what I want you to do: nothing. Absolutely nothing. Do not panic. Do not question your strategy. Do not try to “fix” the gap by timing your contributions or changing your approach.

Your 6% is real. It is yours. And if you keep contributing and keep holding, it will converge toward the long-term fund return over the years and decades ahead.

If anything, the fact that your return is lower in the early DCA years means you are doing things right. It means you are investing regularly, building the habit, and getting money into the market systematically rather than trying to time a single perfect entry. That is exactly what long-term wealth building looks like.

8. What You Should Actually Do About All This

Now that you understand why the numbers differ, here is my practical advice.

Stop comparing your number to the internet

Seriously. The “XEQT annual return” you find online is the TWR. Your Wealthsimple number is the MWR. They are measuring different things. Comparing them is like comparing your marathon finish time to someone else’s 100-metre sprint time. Both are valid measurements of speed, but they are not comparable.

Focus on what you can control

Your savings rate matters more than your return in the first decade of investing. Instead of worrying about whether your personal return is 5.5% or 10%, channel that energy into increasing your monthly contribution by $50 or $100. That will have a far bigger impact on your eventual wealth than any return gap.

Set up automatic contributions and stop checking

The best thing you can do for your XEQT portfolio is automate it. Set up automatic deposits in Wealthsimple — weekly, biweekly, or monthly — and let the purchases happen on their own. Then check your account quarterly at most. The less you look, the less the return number will bother you, and the more likely you are to stay the course.

Use the right benchmark for your situation

If you really want to compare your performance to something, compare this year’s personal return to last year’s personal return. Or compare your total portfolio value to your total contributions. The question is not “am I matching the fund’s TWR?” The question is “am I making progress toward my goals?” If the answer is yes, you are winning.

Understand that this is temporary

As we covered in section 6, the DCA gap shrinks every year. A decade from now, you will look back at this concern and laugh. Your portfolio will be large enough that monthly contributions barely move the needle, and your personal return will closely track the fund’s return. The early years of DCA are the hardest from a psychological standpoint, but they are also the most important from a wealth-building standpoint.

9. A Quick Note on TFSA vs RRSP Returns

One more thing that confuses people: your return might look slightly different in your TFSA versus your RRSP, even if you are holding the exact same fund.

This usually comes down to:

• Different contribution timing. You might have started your TFSA earlier or contributed different amounts at different times than your RRSP.
• Different deposit schedules. Maybe you contribute to your RRSP every paycheque but top up your TFSA in lump sums a few times a year.
• RRSP refund reinvestment. If you invest your RRSP tax refund back into your RRSP (which you absolutely should), that creates an additional cash flow that affects your MWR calculation.

Again, none of this means anything is wrong. It just means your two accounts have different cash flow histories, and the money-weighted return faithfully reflects that. XEQT is the same fund in both accounts — the underlying performance is identical. Only your personal experience of that performance differs.

10. The Bottom Line

Let me tell you how my Sunday morning confusion ended. After an hour of Googling, reading Investopedia articles about TWR versus MWR, and staring at my transaction history, I closed my laptop and poured another cup of coffee. I realized three things:

1. My money was doing exactly what it was supposed to do.
2. Wealthsimple was showing me exactly the right number.
3. The “XEQT returned 10%” headline was not wrong — it just was not about me.

My personal return was lower because I had been contributing $500 every two weeks throughout the year. Most of my money had not been invested for the full twelve months. That was not a failure of my strategy. It was a feature of it. I was building a position gradually, reducing the risk of terrible timing, and developing the most important habit in all of investing: consistency.

Five years later, the gap between my personal return and the fund return has shrunk to almost nothing. My portfolio is large enough now that my biweekly contributions barely register as a percentage of the total. The compounding is doing the heavy lifting, just like everyone said it would.

If you are in your first few years of investing in XEQT and your Wealthsimple return looks disappointing compared to the headlines, I get it. I have been there. But take a breath, understand the math, and keep going. Your number is your real number. It is the only one that matters. And over time, it is going to look better and better.

Stop comparing. Keep contributing. And just buy XEQT.