At last, no more Trading 212 'scam' videos!

If you use Trading 212 to invest in Stocks and Shares or a Cash ISA, you may have noticed that the main screen can be very misleading and it is impossible to know if we have performed well or badly compared to other investors.

Here is an old screenshot which used to just show the total cost price of all the current shares in the portfolio and the gain on those current shares (e.g. current gain on £100k+ account is only £182). However, we do not know how much was deposited into the account in total or what the true return is. This account could have had total deposits of £100,000 for instance, and made various buys and sells over time. £8918 made over a period of 3 months is impressive, but over 5 years it is not so great! The gain of 0.17% does not sound impressive, but if the account had £100k made in deposits, it has actually made £8918 and if that was over a period of exactly one year, that is a 9% true gain (not 0.17%)!

So did this portfolio perform well over the year? Maybe one big gamble on Palantir paid off but all the other investments were stinkers but he sold those last week! From the screenshot, we have no idea!

The problem comes because it is showing the difference between the amount the current shares were purchased for and the amount that those current shares are worth.

YouTubers often display their Trading 212 screens which can appear to show fantastic gains, however this is misleading if we do not know the previous purchase history or how much they have actually deposited into their account and when each deposit was made.

Trading 212 update

My T212 account is shown below (11 Jan 2025). Note: this is my experimental account (not my main account) and includes recent large deposits and investments in crypto, etc. - hence the current poor performance!

Trading 212 have updated their mobile apps and browser-based pages to now display the amount of deposits made - e.g. '£25,000 NET DEPOSITS', on the main screen.

They also display the Total Return instead of the gain/loss of my current investments (£737.33) and the Rate of Return (6.7%) for a certain period (in the case shown below, Max is the whole of my investment period)

Note that it also shows the account type at the top. In this case it is a GIA account so it says '212 Invest'.

Use the grey cog wheel to display a deposits line on the chart.

If you click on 'RATE OF RETURN' now, you will see that that figure now shows the performance of my whole portfolio taking into account how long I have held each share for and how much each share was. This is called the MWRR which is based on IRR and is explained here and here.

Note that the MWRR will vary depending on the time period you have selected (or where the y-cursor is on the interactive portfolio graph). So you should choose MAX to get the overall performance of your account since you first opened it.

Here you can see that on December 6th 2024 I had 20k deposited and my portfolio had an overall performance of  17.5%...

Drag the cursor to display historical MWRR

These new changes gives me a much better insight into my portfolio's performance. 

Note that MWRR shows the annualised performance of your portfolio and is affected by deposits and withdrawals that you make, so you cannot compare different portfolios unless both have had one single deposit and no withdrawals. i.e. it's MWRR depends on your behaviour. A different measure is the TWR which is not affected by deposits/withdrawals and so can be used for comparison purposes (more details here). It would be nice if T212 also provided TWR and then we could directly compare Pie performance.

While time weighted return (TWR) is a good measure of pure performance, money weighted return (MWRR) is a better measure of an investor’s personal performance. This is because it takes into account the timing of cash flows which can be just as important as the ending value.

Pies in T212 also now display Invested and MWRR figures:

A Pie showing net deposit and MWRR.
The deposits can be shown using the cog wheel icon.

MWRR vs. TWR

This graphic is taken from the YTube video here. It shows that MWR shows the actual performance of your portfolio which was affected by your deposit and withdrawal. As a portfolio however, it would have shown a 50% annual gain if you had simply invested once in month 1 and left it there.

At the moment my portfolio is not performing well, but then most of the cash was invested within the last six months and nothing has performed well in that period.

I have recently invested approx £5k in crypto and this has dropped 18% in the last month, so this has also affected my MWRR. I am gambling that the 'Trump effect' will soon cause crypto to have a bull run...