A total return share market index is a type of share market index that measures the overall return of a group of stocks or shares, including both the price appreciation of the stocks and any dividends or other income received from the stocks. Total return indices are often used as a benchmark to measure the performance of a particular investment portfolio or to compare the performance of different investments.
To calculate the total return of a share market index, the change in the price of the stocks in the index is combined with any dividends or other income received from the stocks. For example, if the price of a stock in the index increases by 10% over a certain period of time and the stock also pays a dividend of 5% during that period, the total return for that stock would be 15%.
Total return share market indices can be useful tools for investors because they provide a more comprehensive measure of the performance of a group of stocks. By including both price appreciation and dividends in the calculation, total return indices can give a more complete picture of the returns that an investor might receive from an investment in the stocks in the index.
It’s important to note that total return share market indices are not investments in and of themselves. They are simply statistical measures and do not represent a direct investment in any particular stock or group of stocks.