diff --git a/tests/test_algorithm.py b/tests/test_algorithm.py
index 3735d2ab..5ff15f40 100644
--- a/tests/test_algorithm.py
+++ b/tests/test_algorithm.py
@@ -2167,7 +2167,7 @@ class TestCapitalChanges(WithLogger,
         )
 
     @parameterized.expand([
-        ('target', 153000.0), ('delta', 50000.0)
+        ('target', 127000.0), ('delta', 50000.0)
     ])
     def test_capital_changes_daily_mode(self, change_type, value):
         sim_params = factory.create_simulation_parameters(
@@ -2215,8 +2215,9 @@ def order_stuff(context, data):
             capital_change_packets[0],
             {'date': pd.Timestamp('2006-01-06', tz='UTC'),
              'type': 'cash',
-             'target': 153000.0 if change_type == 'target' else None,
-             'delta': 50000.0})
+             'target': value if change_type == 'target' else None,
+             'delta': 50000.0
+             })
 
         # 1/03: price = 10, place orders
         # 1/04: orders execute at price = 11, place orders
@@ -2320,10 +2321,10 @@ def order_stuff(context, data):
         )
 
     @parameterized.expand([
-        ('interday_target', [('2006-01-04', 2388.0)]),
+        ('interday_target', [('2006-01-04', 1899.0)]),
         ('interday_delta', [('2006-01-04', 1000.0)]),
-        ('intraday_target', [('2006-01-04 17:00', 2186.0),
-                             ('2006-01-04 18:00', 2806.0)]),
+        ('intraday_target', [('2006-01-04 17:00', 908.0),
+                             ('2006-01-04 18:00', 1408.0)]),
         ('intraday_delta', [('2006-01-04 17:00', 500.0),
                             ('2006-01-04 18:00', 500.0)]),
     ])
@@ -2486,10 +2487,10 @@ def order_stuff(context, data):
             )
 
     @parameterized.expand([
-        ('interday_target', [('2006-01-04', 2388.0)]),
+        ('interday_target', [('2006-01-04', 1899.0)]),
         ('interday_delta', [('2006-01-04', 1000.0)]),
-        ('intraday_target', [('2006-01-04 17:00', 2186.0),
-                             ('2006-01-04 18:00', 2806.0)]),
+        ('intraday_target', [('2006-01-04 17:00', 908.0),
+                             ('2006-01-04 18:00', 1408.0)]),
         ('intraday_delta', [('2006-01-04 17:00', 500.0),
                             ('2006-01-04 18:00', 500.0)]),
     ])
diff --git a/zipline/algorithm.py b/zipline/algorithm.py
index 0f134b1c..097ff2c6 100644
--- a/zipline/algorithm.py
+++ b/zipline/algorithm.py
@@ -825,12 +825,17 @@ class TradingAlgorithm(object):
 
         return daily_stats
 
-    def calculate_capital_changes(self, dt, emission_rate, is_interday):
+    def calculate_capital_changes(self, dt, emission_rate, is_interday,
+                                  portfolio_value_adjustment=0.0):
         """
         If there is a capital change for a given dt, this means the the change
         occurs before `handle_data` on the given dt. In the case of the
         change being a target value, the change will be computed on the
         portfolio value according to prices at the given dt
+
+        `portfolio_value_adjustment`, if specified, will be removed from the
+        portfolio_value of the cumulative performance when calculating deltas
+        from target capital changes.
         """
         try:
             capital_change = self.capital_changes[dt]
@@ -852,13 +857,12 @@ class TradingAlgorithm(object):
                 False,
                 self.data_portal
             )
-
         self.perf_tracker.prepare_capital_change(is_interday)
 
         if capital_change['type'] == 'target':
             target = capital_change['value']
             capital_change_amount = target - \
-                self.updated_portfolio().portfolio_value
+                (self.updated_portfolio().cash - portfolio_value_adjustment)
             self.portfolio_needs_update = True
 
             log.info('Processing capital change to target %s at %s. Capital '