All-Shareholder Return, All-Period Returns and Total Index Return

Abstract

The all-shareholder return is the return that all the shareholders of a company had in a period. It is equal to the hypothetical return of a unique shareholder of the company. It is also the return of a shareholder that always had a constant proportion (ie. 0,2%) of the shares.

The all-period shareholder return is the return that a shareholder that maintained the shares for the whole period had. We will see that there are many all-period shareholder returns, depending on the actions of the shareholder during the period: fraction of dividends reinvested, fraction of shares sold when the company repurchased them, number of shares subscribed when the company increased capital…

Most databases provide a special all-period shareholder return valid for a shareholder that reinvested 100% of the dividends, did not sell any share in repurchases and did not subscribe any new share when the company increased capital. In many situations, there are substantial differences among these returns.

We show that the all-period shareholder return of Cisco in the period 1990-2012 was 24.7%, but the all-shareholder return was 9.0%.

Keywords: all-shareholder return; shareholder return; unique shareholder; all-period shareholder return

JEL Classification: G12, G31, M21