I assume many of you do track the performance of your portfolio. I am tracking mine in my spreadsheet using the XIRR() function. (On 1.1. I put the current value of my portfolio as a negative entry (as if I bought everything at the beginning of the year), and then on the 31.12. the total value of the portfolio at the end of the year.)
Now here is the thing: For 2019 up until today I got a return of 44.25%
This seems rather high compared to VT’s ytd of ca. 27%. (My portfolio does not match VT 100% since I do have some old picked stocks from the time before I discovered Vanguard. However, they did not outperform so much that this could turn the tide.)
So I am wondering: Is XIRR not the right formula to track the return of a portfolio? How do you guys track your performance? And what performance did you get in 2019?
I made most of my investment during this year, so I only tracked the total gain in CHF and the annualised performance of each position. It goes from 3% to 750%
As an option trader I use this software (https://www.tradingdiarypro.com/), you can import different broker statements – perfect for Interactive Brokers
23% YTD performance for my 90% VT, 10% cash portfolio.
I pull my numbers from the IB portfolio interface every couple of months and manually put them into an Excel file. I don’t think I need anything more complicated than that with my simple setup.
I don’t know about XIRR(). I use unitisation to track my rate of return. Basically I started my spreadsheet by assigning a value of 1 CHF per unit. From then, the value would change but the number of units remain the same until I add (or withdraw) money from the portfolio. Whenever I dump more money in, I increase the number of units accordingly. My rate of return is the rate at which the unit value increased.
The exact number is not terribly meaningful but it helps to check I am not doing something terribly stupid as a similar method is used by most funds and the metric can be compared. Also it makes for pretty graphs.
Use the formula used by the function on a piece of paper for a few simple examples. Best way to get to understand the function (and see that it doesn’t make sense to use it for your purposes).
25.87 % on liquid investments. The broker makes a calculation of the Money-Weigthed Rate of Return which is of 25.54 %. The second number takes into account the in-out-flow of money. I never expected 2019 to be such a good year. Be ready for some year where you are happy with a progression of 2-3% due to only the dividend.
According to IBKR: TWR of 26.27%, MWR 23.55%.
Lucky enough to have been procrastinating lazily until end of 2018 to start (seriously) investing.
And very aware of it, not expecting anything close in the coming years.
Actually considering selling bits of exploded ones, like Apple (95% growth on my DCA price), and increase the cash position slightly in the coming months.
Or no progression at all, and even a drop - aka discount buying opportunity
15% for me. Not stellar because I have about 60% in Berkshire Hathaway and they didn’t have a great year (about 11%).
Fundsmith emerging market is the position I added to the most this year and it kept getting lower and lower, trading now at -12.5% of the Net Asset Value. The fund holds good companies so in the long run there will be growth. Will the growth match the index? No one knows… but I’m comfortable with underperforming if that’s the price for knowing what I own.
Same here. I’m too focused lately on my family, work and hobbies. No time for finance stuff. I mean finance is also my hobby, but there others as well that currently captivate my attention.
Yeah, and that‘s totally fine if you don‘t need a certain return on average.
But if you want to use the 4% rule or something similar, then it‘s kind of interesting to know which returns you are getting with your portfolio. And with comparing your annual returns to VT, you get a feeling how much you can rely on US retirement studies or how much you‘d need to adjust your retirement withdrawals.
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