Performance Fee Deposit Withdrawal

[milli1905]

Hi Mark,

I'm looking at the documentation for the Advisor version and will possibly upgrade to that version.

How do you handle deposits and withdrawals when calculating Performance over a period? Do you in effect do a NAV calculation?

//Milli

[Mark]

Hi Milli,

For ROI yield calculations, deposits/withdrawals of cash are just another term in the yield equation. These are essentially performance neutral. They do change the weighting of your cash, relative to the rest of your investments, but the buy/sell of cash itself is usually done at the same price of 1, so it isn't going to impact the ROI, other than the re-weighting issue. You can read all about ROI yields, and the equation used here:

https://www.fundmanagersoftware.com/hel ... s_roi.html

For TWR yields, external cash flows are factored out of the calculation, so buys/sells of cash do not impact TWR. The documentation on TWR is here:

https://www.fundmanagersoftware.com/hel ... s_twr.html