How to Read a Monthly Return Heatmap in Under a Minute

A fund’s annual return is a single number that averages away everything interesting that happened during the year. A fund that went up 2% every single month and a fund that lost 15% in March then clawed it all back by December can both post the same annual figure. A monthly return heatmap is what shows you which one you actually held.

What you’re looking at

Each row is a calendar year. Each column is a month. Each cell is that fund’s return for that specific month, shaded green for a gain and red for a loss — the deeper the shade, the bigger the move. An “Annual” column at the end compounds the twelve months into the year’s total return, so you can see both the forest and the trees at once.

Three things to actually look for

Clustering. Are the red cells scattered randomly, or do they cluster in certain months or years — often alongside a broader market drawdown? Clustering that lines up with known market stress (2020, for instance) tells you this fund moves with the market. Red cells scattered in otherwise calm periods are more concerning — that looks like fund-specific risk, not market risk.

Consecutive red months. One bad month is normal. Four or five in a row is a drawdown, and it’s worth checking whether the fund’s maximum drawdown figure lines up with what you’d expect from the streak you’re looking at.

Consistency across years. A fund with a mix of green and red every single year, with no one year dramatically worse than the rest, is behaviourally very different from one with two or three quiet years followed by one brutal one — even if their average annual return is identical.

Why this matters more than it seems

Investors rarely experience a fund as a single compounded number — they experience it month by month, and behavioural decisions (panic-selling, stopping SIPs) usually happen during the red stretches. A heatmap is the closest thing to seeing what that actually felt like to hold.

Explore live monthly heatmaps for any tracked fund on our comparison dashboard.