The return from a bond that incorporates the interest received during the holding period and any capital gains (the difference between the purchase price and the selling price). It is expected that the value of total return fluctuates along with the price of a bond on the secondary market. As capital gains are taken into account in total return calculation, this measure applies to individual bonds only if they are sold before they reach maturity.

Similarly, it applies to bond mutual funds and exchange-traded funds because they don’t have a maturity date and their market prices and dividend payments incessantly change over time. An investor in a bond fund might choose to sell his shares if the total return falls below a set limit.