Re: Portfolio Yield Error

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In Reply to: Re: Portfolio Yield Error posted by George on July 12, 2004 at 18:41:23:

: : : I believe there is an error when calculating the yields that are displayed when displaying a portfolio graph. I'm running the latest version, 6.8. Here is an example of what I'm seeing, not my actual numbers. Say the Portfolio Gain-H graph is used. The beginning date is 3/25/99 and the ending date is 7/9/04. On 3/25/99 the portfolio suffered a $10000 loss. The yield displayed for the entire length of the graph, the "gph" yield is 6.5%. I change the beginning of the graph to 3/24/99 which the portfolio had a big gain of $40000. The "gph" yield is now 5.8%?? No way can the yield be lower when I move back one day that had a large gain. The "gph" yield has to be more than 6.5%, not less.

: : : I think this error was introduced after version 6.6. I went from 6.6 to 6.8, skipping 6.7. I believe the yield was acting correctly on 6.6. Its like the yield calculations is no longer considering the gain/loss the portfolio receives on the beginning day of the graph.

: : Hi George,

: : You're very observant. We did change the way the beginning date worked
: : for the "gph" yield term. Prior to 6.8 the beginning information was the
: : close of the prior day. So, if the yield was from 3/25, it would use the
: : close of 3/24, and include any effects that happened on 3/25 itself. As
: : of 6.8 we changed it to start with the close of the beginning yield date.
: : In this example, it would start with the close of 3/25, ignoring any
: : gains/losseson 3/25 itself.

: : This was done to be more consistent with the overlay graphs. When your
: : overlay graph starts on 3/25, that close is the first data point plotted, and
: : everything is relative to that. You don't see the gain/loss on that 3/25
: : day itself.

: : So, for your example, when you've got the start date set at 3/25, you're
: : not seeing the large $10000 loss on 3/25 in the "gph" yield. When you
: : move the start date back to 3/24, you're not seeing the large $40000 gain
: : on 3/24, but you now are seeing the large $10000 loss on 3/25, thus the
: : yield decreases.

: : Thanks,
: : Mark

: I feel the better and more consistent way to handle this is to change the overlay graphs so they also include the effects of the beginning date. Just as I described its inconsistent to include a beginning date with a big gain but see the yield drop. Also if I want to see the yield for say a year of time, a year would go from 3/25/03 to 3/24/04. Going from 3/25/03 to 3/25/04 is a year plus a day. To be consistent everything should, IMHO, INCLUDE the effects from the beginning date and the ending date. Besides a new day starts at midnight, and if the markets are open my portfolio undergoes changes so I should see those changes be reflected in the graphs, the yields, the overlay graphs, and everywhere else.

: If you disagree with my opinion can you please make version 6.6 available somewhere on your website as I would prefer to switch back. Or maybe make it a user selectable option for the user to decide if he/she wants to include the effects of the beginning date.

: George

Hi George,

Okay, I think you've convinced me. Let me think about it a little more, but
I'll most likely switch it back for 7.0. Changing the initial value
for the overlay graph instead does make better sense.

I've posted version 6.7 here:
http://www.fundmanagersoftware.com/programs/tempfm67.exe

I'll leave it there for a couple of days. Version 6.7 worked the same
way as 6.6 for this item.

Thanks,
Mark
--
Mark Beiley
Fund Manager, portfolio management software for Windows 95/98/ME/NT/00/XP/2003

Replies:

• Re: Portfolio Yield Error George 01:27:28 07/13/04 (0)
• Re: Portfolio Yield Error George 00:55:49 07/13/04 (3)
  • Re: Portfolio Yield Error Mark 10:22:26 07/13/04 (2)
    • Re: Portfolio Yield Error George 21:27:21 07/14/04 (1)
      • Re: Portfolio Yield Error Mark 08:58:38 07/15/04 (0)