[theory6453]

Hey all. This question is more portfolio-related rather than SA-related, but I wanted to get some feedback on how everyone calculates their portfolio performance since we are closing in on the end of the year.

The way I am calculating it currently for my retail portfolio is as follows:

EOY % Gain/Loss = Change in Portfolio Value / (Beginning of Year Portfolio Balance + Debits) = XX.X%

Change in Portfolio Value = End of Year Portfolio Balance - Beginning of Year Portfolio Balance - Debits + Credits

Debits = Sum of Total Deposits made during the Year

Credits = Sum of Account Withdrawals = Sum of Margin Interest Charged + Sum of Commissions Fees

There is a "real" performance versus "true" performance factor to be taken into account. For example, the method above shows the "true" performance of my portfolio since I am backing out Broker Commissions Fees and Margin Interest. If I were to calculate the "real" performance of my portfolio, I would not back those out as they are the "costs of doing business" so to speak and those fees would be included in my portfolio's "real" performance and my performance would lower. Any dividends received are already baked in.

This is how my 401K calculates it (approximately) when I login to the Fidelity website but wondering if maybe there is a better way to do it or if anyone has any feedback on my approach.

Danke.

Personally I'm only interested on how each stock has done on an ATR adjusted basis and am looking for the winners that I close out to be at least 3 times the losers. So for example I use a -2x ATR value for my stop loss distance on average, so I want my closed winners to be at least 6x ATR. The portfolio percentage value overall is affected by the various costs and inputs you mentioned above and they vary on a percentage basis based on your account size, so I prefer the stock by stock approach to get a better idea of performance.

Good point. The bigger your account gets, the less impact the fees or deposits might potentially have on overall performance using the method I described. Thanks Isa.

Follow-up: Once you have determined your winners/losers on an individual basis, do you do any aggregation of the results or use any kind of average or weighted average to get a higher-level view of performance? How are you determining a "good" year versus a "bad" year? Are you just looking for the number of winners to outweigh the number of losers? Or maybe you don't quantify it from that perspective? My goal is to try to get an objective measure of how I did overall for the year so I can compare against my past performance to see if I am doing better/worse/same...