Total Return

An investment can earn you money in two ways: its price can rise, and it can pay you income along the way, such as dividends from shares or interest from bonds. Total return counts both, as if every payout were reinvested. It's the full measure of what an investment earned, because the price alone leaves out the money it paid you.

The SMI, the index of 20 of the largest Swiss companies, is a price index: it follows their share prices and leaves the dividends out. SIX also calculates the same index with every dividend reinvested, the SMIC. Here's what CHF 10,000 put into each at the end of 1996 became, next to the SPI, the index of almost the whole Swiss market, which counts dividends too:

After 9 years, at the end of 2005, the CHF 10,000 had become CHF 19,238 in the SMI, CHF 22,147 in the SMI with dividends and CHF 22,861 in the SPI. After 19 years, at the end of 2015, it was CHF 22,368, CHF 34,417 and CHF 36,204, and after 29 years, at the end of 2025, CHF 33,655, CHF 71,363 and CHF 72,533.

On prices alone the money grew 4.27% a year, compounded, which means the steady yearly rate that gives the same end result; with the dividends, 7.01%. A gap of 2.74 percentage points a year adds up: without the dividends, CHF 37,708 of the CHF 61,363 gain would be missing. These are our calculations from the closing levels SIX publishes, before costs and taxes.

The SMI and the SPI are the two Swiss indices quoted most often, but they differ in two ways at once: the SPI counts dividends, and it holds far more companies, about 200 against the SMI's 20. Over the 29 years the SPI grew 7.07% a year, compounded, close to the 7.01% of the SMI with dividends. So most of the gap between the SMI and the SPI is dividends, and the rest comes from holding different companies.

SIX also publishes the SPI without dividends, but its public daily closes only go back to December 1997. From the end of 1997 to the end of 2025, CHF 10,000 grew to CHF 23,074 on prices alone and to CHF 46,739 with dividends. When you compare a fund with an index, make sure the index counts dividends too, as the page on index funds explains.

Ordinary dividends from Swiss companies arrive with 35% withholding tax deducted, but the index with dividends reinvests each one in full, before tax. In 2025 the SMI rose 14.37% and the SMI with dividends 18.03%. The gap, 3.66 points, is a little more than the dividends themselves, because once reinvested they rose with the market. By our estimate, CHF 10,000 in the SMI's companies at the start of 2025 received about CHF 330 in dividends during the year:

If all of it was ordinary dividends, CHF 116 went to the tax office and CHF 214 to your account. Payouts from a company's capital contribution reserves, money its shareholders once paid in, can be free of withholding tax, so CHF 116 is the most it could be. If you live in Switzerland and declare the shares and the dividends in your tax return, you get the withheld amount back, usually the following year, so in the end you receive what the index counts. Someone who can't reclaim the tax keeps only the rest.

Twenty-nine years of one market is one path. The figures start at the end of 1996, because SIX's data for the SMI with dividends from before 1996 don't follow the SMI's daily moves, so that's the first year-end we could start from. A different start or end would change every number, and this one comes just before the SMI rose 59% in 1997. The figures are before fund costs and taxes, and nobody can buy an index itself: a fund that tracks one charges a fee.

And "prices only" isn't quite pure. SIX can reinvest special dividends, one-off payouts outside a company's usual dividend, even in the SMI. What the SMI leaves out is the regular dividends, and any capital a company pays back to its shareholders.