Re: performance

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In Reply to: Re: performance posted by csc on June 03, 2005 at 13:18:06:

: : : Your performance measurement function appears to produce some odd results. How is it possible for a money market fund to show negative returns?

: : : Suppose we have a position with an original cost of 100, and a current value of 110. Specifically, how do I produce a report showing the 100 cost, current value, the 10 gain and a percentage gain of 10%, skipping the effect of dividend income?

: : : Thanks.

: :
: : Hello csc,

: : Which performance measurement function are you looking at? Is this some report? Which field are you looking at? From within any report you can choose "Help / Help on Report", and it will describe how each figure is calculated. This may help explain the results.

: : Most performance figures are set up to include the effects of dividends... You could use these fields in a Custom report:

: : Out of pocket basis (current)
: : Value (ending)
: : Gain (current)
: : %Gain (current)

: : The "Out of pocket basis (current)" field will report your cost on the currently owned shares. It is however reduced by the amount of any distributions you received in cash.

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

: When you run a portfolio performance report for a period, the report lists the positions held and the returns for each, including the money fund. If the money fund's value has declined during the period,due to purchases for example, it shows a loss which apparently reduces the overall portfolio return, even though it should not.

: The "out of pocket basis" is not very useful because income received does not normally reduce the original cost basis. Distributions such as dividends should contribute to results during the period in which they are received (income during the period divided by beginning value).

: csc

Which column in the Portfolio Performance report shows a loss? If you are looking at the simple %Gains, this can be true. If you're looking at the yield, this does not get hurt by you taking money out. %Gains do not factor in the time value of money, and can often be misleading. Yields on the other hand do factor in the time value of money. Please read "Help / Help on Report" from within this report, and it will explain how each column is calculated.

Fund Manager can report multiple cost basis numbers. The "Out of Pocket" is useful for knowing your overall break even point. Fund Manager can also report all of the tax cost basis numbers as well (FIFO, AVG, or Specific Lot). Distributions received do not affect the "tax" cost basis figures, but they do affect the "Out of Pocket" cost basis figures. They each have their own purpose. All of the "Tax" cost basis figures are also available for reporting.

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

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