Time To Calculate Portfolio Performance

It takes me some significant time to calculate performance on the 5 portfolios that I run. This is due to the fact that I do a lot of analysis on stocks held today and previous sales as well as calculate expense ratios, dividend ratios, and other tasks by individual stocks. I am going to try to find time to do this over the three day weekend since the stock markets are closed on Monday, January 5th (in the US).

By some measures it is a disheartening time to calculate performance. Indexes are down about 10% for the second quarter, and some international stocks in the portfolio were pummeled even harder by currency moves that hurt the Euro and favored the dollar.

I am going to use this information to distribute to the nieces and nephews and use the month of July and early August to select the six stocks for my 2010 recommendations. There may also be some recommended sales of stocks in the existing portfolios.

The most encouraging part of this for me is that this trust fund effort has done a great job on encouraging savings and thrift and teaching about real-world financial performance, both the good and bad. Since each beneficiary only puts in net 1/3 of the total investment (I put in $500, they put in $500, and then I match $500 more) the odds that the portfolio is reduced to the point where they are losing money on their portion of the investment are low (i.e. that we are down 66%). Every loss is painful, however, and I get questions to answer about how I selected the stocks and what happened. This is part of life today, and will be part of life in the future. There are no easy answers to these questions, just a life of education and the fact that having an in depth understanding of finance and money can be just as important as learning a trade or building an otherwise successful career.

Also if any legitimate commenter are out there, feel free to say something. It was nice to have someone comment that they agreed with my approach on the “match” as far as being an effective approach for teaching and increasing involvement in the outcome. As Dan has noted this site is an insane spam-comment magnet for whatever reason and while I used to occasionally peruse the spam comments before I deleted them now I just delete away because there are over 100 in the queue if I go even a few days without purging it.