Figuring total return for a stock is easy if you have the data

— -- Q: Is there an easy way to determine what a stock's total return has been during a specific period? Can you use an example of 10 shares of Caterpillar cat bought on Jan. 1, 1985?

A: Measuring total return on a stock can be as simple or complicated as you'd like. Total return measures how much you've gained from owning an investment, including its dividends.

Measuring a stock's total return is much like measuring the performance of your portfolio. There are easy ways to do it, as explained here, or it can be more involved.

When you're measuring the total return on a stock, it's nearly the same exercise as measuring a portfolio's return, with some important differences, which I'll explain.

But first, this is a good opportunity to tell you about a new feature at USATODAY.com that may serve many investors looking for a quick look at a stock's total return for one year. When you enter the symbol of any stock into a Get a Quote box at USATODAY.com, you'll find something few financial websites offer: year-to-date price change. At the top of each stock quote page, you'll find YTD% Chg., which is the year-to-date percent change in the price of the stock. If you add the stock's dividend yield, found in the first set of stats under the charts on the stock quote page, you'll get a ballpark idea of what the stock's total return would be during the year if the stock were to close exactly where it is now.

That's a quick and dirty stab at total return. What you're asking takes more effort. In this example, I'll stress a method that's not precise, but also not that difficult. Your example is a bit more complicated since you want to go back to the 1980s.

We need three pieces of data to get your total return estimate. Youl need: 1)The price you paid for the stock 2) The current price of the stock and 3) The sum of all the dividends you've received during the period.

Let's go one by one. In most cases, you should have the price you paid either from brokerage statements or by checking the brokerage firm's website. If not, you can get a decent estimate by looking up the stock's closing price on the day you bought the stock.

You asked about Jan. 1, 1985. But that's not only a holiday, it's a weekend. So, grab the quote from Dec. 31, 1984. You can get most historical quotes from USATODAY.com's Historical quotes features. Here's the quote for CAT: $31. But that's not the number we need. We need to know the split-adjusted price, which USATODAY.com calculates for you. That price was $3.88.

Next, you need the current stock price. That's pretty easy, and you can get that from the quote pages at USATODAY.com. The stock price when I wrote this column was $39.35.

Finally, here's the trickiest part. You need the sum of all the split-adjusted dividends paid by the company during that time period. You can usually get that directly from the company's website. Caterpillar provides them going back to 1996. Caterpillar makes the data available here. If you import the dividend data into Microsoft Excel, you can total the split-adjusted dividends and see Caterpillar paid $10.77 a share in dividends during that period.

But, your question is tougher since you want to go back to 1985. To do this, use moneycentral.msn.com, which records split-adjusted dividends going back for decades in its historical charting feature.

Enter CAT into the blank in the upper left-hand corner and click the "Get Quote" button. Next, click on the "Historical" option under Charts on the left side of the page.

If you've never used the site before, you may need to click on the MSN Investment Toolbox link, which installs a small and harmless browser Add-On that enables this advanced feature. Use the Period pull-down option to enter the dates under Custom. The chart will then display all the dividends on the chart, noted by a square brown icon with the letter D. If you place your mouse point over the icon, you see the dividend. I'll summarize the numbers below, using annual numbers for simplicity.

1985: 0.0641986: 0.0641987: 0.0641988: 0.0961989: 0.1521990: 0.1521991: 0.1521992: 0.0761993: 0.0761994: 0.1141995: 0.302Total between 1985 to 1995: $1.312

So if you add the dividends from MSN Money Central to the dividends from Caterpillar, you get $12.082 per share during the period.

Still with me? The final step is the math. If you want a precise total return, you can follow the directions in the earlier Ask Matts on performance tracking and use the dividend payments as cash flows.

But you've been through enough already, haven't you? Here's what you do. Add the total dividends, $12.082, to CAT's current price, to get $51.43. Subtract your purchase price of $3.88 from $51.43 and then divide by $3.88. The answer is your total return during the period: 1,325.5%.

Matt Krantz is a financial markets reporter at USA TODAY and author of Investing Online for Dummies. He answers a different reader question every weekday in his Ask Matt column at money.usatoday.com. To submit a question, e-mail Matt at mkrantz@usatoday.com. Click here to see previous Ask Matt columns.