Re: Seems like an error

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In Reply to: Re: Seems like an error posted by Mark on February 14, 2005 at 11:06:40:

: : OK, I understand now. But it would seem to me the best thing to do is base the Portfolio Overlay graphs on "actual" portfolio performance. I thought that was the hold point of the Overlay graphs, to see how my portfolio performed relative to the other investments I selected for the overlay. In my case I like see my portfolio relative to the S&P 500 and NASDAQ indices. Now I know it is not quite correct, bummer.

: Hi Linda,

: Yes, the plotting of a portfolio "share price" is not perfect, as there
: really is no such thing. This is a synthesized value to get as close as
: possible to what a hypothetical share price for the portfolio would be.

: When you're overlaying a portfolio with investments and you have "Value" selected
: then the real portfolio value is plotted, and a synthesized "portfolio normalized"
: value is plotted for the investment, so as they can be compared. When you
: have "Price + Dist." selected, then the real investment price + Dist. is plotted,
: and a synthesized portfolio price + dist. is plotted. Either way, something
: must be synthesized to compare a single investment with a whole portfolio.

I don't understand why you must synthesized a portfolio for the "Price + dist" graph. Just use the "real" portfolio and normalize it to start at a value of 100. I would think any user of FM would prefer to use their actual portfolio in both the "Value" and "Price + dist" overlay graphs. Isn't that the objective of these overlay graphs?? To compare the performance of my actual portfolio to the chosen overlay investments.

Replies:

• Re: Seems like an error Mark 21:13:28 02/15/05 (1)
  • Re: Seems like an error Linda 10:44:09 02/18/05 (0)