How to calculate returns from Stocks including dividends

This post describes how one can calculate returns from stock investments including the declared dividends.  There is a lot of confusion about this calculation with regard to how the dividend should be treated.

In this post, return refers to XIRR, that is the personal rate of return. See this for more details:  What is XIRR?

The following is the universally accepted definition of computing return from cash flow:

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New Version: Excel PPF calculator and Tracker

An update to the PPF calculator and tracker published last September.  The calculator is the creation of Karthikeyan Chellappa. The tracker is based on his template with a simple modification.

Thanks to feedback from Krishna Chandrashekar,  I have allowed for the interest rate to vary each month. This way, users can account for interest rate changes that occur in the middle of the financial year (eg. Dec. 2011). Future changes may occur only at the start of the FY. However, because of that one change in Dec. 2011, users with old accounts could not use the previous sheet. Hence this new version.

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The Monday Roundup

Starting this week, I would like to post a roundup, each Monday with three or four segments:

(1) a list of posts published the week before, just in case you were too busy last week.

(2) a short note on a physics fact. Some readers suggested I do it, so let me give it a shot.

(3) short notes or links to financial stuff I read last week. I read very little, but would like to force myself at least for the roundup post.

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E-book: DIY Personal Money Management

Here is an e-book based on a (nearly) unabridged collection of 20 posts written earlier.  I have not bothered to connect the chapters. I hope that will not spoil your experience too much. Perhaps only a reader who is used to my style and intent might find this collection useful.

This is an experiment. Please let me know if it is a good idea to compile past posts as an e-book.

The following posts are part of the compilation

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‘Passive’ income requires ‘active’ involvement!

After reading well-spun yarn like ‘Rich Dad, Poor Dad’, many start talking about the importance of financial independence and passive income. There is no free lunch in the universe and there is no such thing called ‘passive’ income. A look at some well-known passive income ‘streams’ and what it takes to make them count.

Income from rental property

If you are earning rental income from ancestral property which you naturally inherited (without litigation etc.) then it is sheer luck. It is perhaps passive, but it unplanned. So does not count.

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