What does the Inflation Adjusted toggle do?

Q: What does the Inflation Adjusted toggle do?

When the Inflation Adjusted toggle is enabled, every monthly return shown is converted from a nominal return to a real return - what you actually gained in purchasing power after consumer prices rose that month. The conversion uses the standard formula: real return = (1 + nominal return) ÷ (1 + monthly CPI change) − 1 Inflation data comes from the BLS CPI-U (Consumer Price Index for All Urban Consumers), measured month over month. Because the CPI is published with a roughly one-month lag, the most recent month carries forward the last known CPI value until the official print arrives - an approach that avoids guessing. A few things to know: The toggle is global : equity curves, CAGR, drawdowns, detailed metrics, savings and withdrawal projections - everything recomputes in real terms. A hint appears under the controls ("Showing real (inflation-adjusted) returns") so you always know which mode you're in. Months with no CPI data available are left unchanged rather than estimated. The setting is preserved in the page URL, so a shared link reproduces exactly what you were looking at. Why use it? Long backtests can flatter a strategy: a 10% nominal year during 8% inflation only grew your purchasing power about 2%. Real returns are the honest yardstick for long-horizon planning, especially for withdrawal-rate analysis.

Question

Accepted Answer

When the Inflation Adjusted toggle is enabled, every monthly return shown is converted from a nominal return to a real return - what you actually gained in purchasing power after consumer prices rose that month.

The conversion uses the standard formula:

real return = (1 + nominal return) ÷ (1 + monthly CPI change) − 1

Inflation data comes from the BLS CPI-U (Consumer Price Index for All Urban Consumers), measured month over month. Because the CPI is published with a roughly one-month lag, the most recent month carries forward the last known CPI value until the official print arrives - an approach that avoids guessing.

A few things to know:

The toggle is global: equity curves, CAGR, drawdowns, detailed metrics, savings and withdrawal projections - everything recomputes in real terms. A hint appears under the controls ("Showing real (inflation-adjusted) returns") so you always know which mode you're in.
Months with no CPI data available are left unchanged rather than estimated.
The setting is preserved in the page URL, so a shared link reproduces exactly what you were looking at.

Why use it? Long backtests can flatter a strategy: a 10% nominal year during 8% inflation only grew your purchasing power about 2%. Real returns are the honest yardstick for long-horizon planning, especially for withdrawal-rate analysis.