Fund Manager
PORTFOLIO MANAGEMENT SOFTWARE
Contact Us

Benchmark reports - How to properly setup?

Questions on using, creating, or understanding data in Fund Manager reports.

Postby jstolzen » Thu Dec 23, 2021 9:36 am

Hi, Mark. I'm trying to create various benchmark reports to compare the performance of my portfolio to a mix of Total Stock/Total Bond portfolios (eg: 40% VTI - Vanguard Total Stock and 60% BND - Vanguard Total Bond).

I thought I could do this with an overlay portfolio, but am having some issues.

First - how would I setup the overlay investments? I first thought I could do something like create the Investments with an initial balance of 4 shares VTI and 6 shares BND to represent a 40/60 AA. That creates the right allocation. However - I can't figure out a way to then account for distributions (dividends, LT and ST Cap Gains) so that I can get the right total return numbers.

I did figure out how to create a CSV file containing distributions, but all data sources (Vanguard, Yahoo, etc) are going to give a distribution amount per share. So that doesn't appear to work as the import will just bring in a $X per share distribution if I use DIST_D, DIST_L and DIST_S as TRAN types.

Note that I also tried to create the Investments in the overlay portfolio having 0 shares each - but two problems with that..first, I can't then figure out how to represent the various asset allocations (such as 40/60). Secondly, even if I import distributions and retrieve full price history data for the period in question, the "Distrib" column in the Investment Performance report shows 0 and % Gain-F is incorrect.

Can you please help? I'd really like to be able to compare portfolio performance to various asset allocations (eg: 40/60, 60/40, 70/30, etc) but am at a total loss to understand how to do so and still account for distributions.
jstolzen
 
Posts: 24
Joined: Sat Jan 14, 2017 1:44 pm

Postby Mark » Thu Dec 23, 2021 9:46 am

Hi jstolzen,

Which version of Fund Manager are you using?

In the Pro/Adv versions you can use the Create Blended Investments feature. This will give you a blended investment you can use in the Overlay graphs.

In your source investments you can either retrieve actual closing prices, and record distributions, or you could retrieve adjusted historical prices from Yahoo (Adjusted Historical). If you use the regular Yahoo (Historical) server, you can ask it to retrieve distributions/splits (if you're using Pro/Adv).
Thanks,
Mark
Fund Manager - Portfolio Management Software
Mark
Site Admin
 
Posts: 10531
Joined: Thu Oct 25, 2007 2:24 pm
Location: Chandler, AZ

Postby jstolzen » Thu Dec 23, 2021 11:15 am

I'm using Personal.

Is there a way to do it in this version?

We're early retirees so would prefer to be able to do this using Personal if possible, as cost is always an issue for those of us living off savings pre-SS.

Thanks..
Last edited by jstolzen on Thu Dec 23, 2021 11:27 am, edited 2 times in total.
jstolzen
 
Posts: 24
Joined: Sat Jan 14, 2017 1:44 pm

Postby Mark » Thu Dec 23, 2021 11:25 am

Hi jstolzen,

There isn't an automatic way to do it, but you could do the equivalent in Excel, and import this data as a blended investment.
Thanks,
Mark
Fund Manager - Portfolio Management Software
Mark
Site Admin
 
Posts: 10531
Joined: Thu Oct 25, 2007 2:24 pm
Location: Chandler, AZ

Postby jstolzen » Thu Dec 23, 2021 12:05 pm

OK..I'll have to take a look at Pro and Blended Investments to see if that will work for what I'm trying to do.

Blending investments aside, I'm still not able to get the YTD % Gain numbers to match what's reported on M* or elsewhere for some reason on my individual benchmark investments - ie: funds that I don't actually own so do not have transaction level detail for.

For example, I created my test "benchmark" portfolio and added a single investment (VTI). I then entered a price of $191.87 for 1/4/21 with 0 shares owned. From there, I imported the three 2021 distributions that have happened to-date: .67, .68 and .72. In the Investment Performance report, % Gain-F and Return are both showing as 24.6%, but M* shows YTD return (Investment NAV) as 24%. Note that both are calculating per the closing NAV on 12/22 (yesterday) of $239.02 and the latest Price record I have for VTI in FM is for 12/22/21.

Even stranger, if I enter a purchase transaction of 1 share on 1/4/21 using the closing price that day ($191.87), the %Gain-F is then 25.7 and Return is 25.8 - no longer 24.6%. That seems odd as I'd expect it to be the same, although I'm sure I'm just missing something..

Any idea why the YTD returns in FM are different than what M* is reporting? Or why I get two different results depending on whether there is a purchase transaction for 1 share on 1/4/21 with a price equal to the closing NAV? Shouldn't that be the same as if there were 0 shares since there'd be no additional return given the 1 share was bought at the closing NAV - so, 0% additional return since the first Price record in FM is for 1/4/21.

Also - am I setting this up right (create the investment using the closing NAV for the 1st day of the period I'm interested in - eg: for YTD, 1/4/21 with 0 shares owned) then downloading or entering divs, LT cap gains and ST cap gains as $ amounts only - no share data (eg: not $X distribution, Y # of shares at $Z per share)?

Lastly, I thought I read an earlier post that Yahoo Historical does not download LT cap gains. So do these need to be entered manually still?


Thx..
jstolzen
 
Posts: 24
Joined: Sat Jan 14, 2017 1:44 pm

Postby Mark » Thu Dec 23, 2021 12:40 pm

Hi jstolzen,

I can't say how M* calculates their returns, but if you're looking for a YTD number, you should record a closing price as of 12/31/2020, as that would be where the year 2021 started. The closing price of 1/4/21 is not the beginning price of the year. The 1/4 price is at the end of the first trading date, so you would be missing changes between the end of 12/31/20 and 1/4/21.

Also, %Gain-F are not time weighted numbers. It is a simple division, so you can calculate it yourself to confirm against what you're seeing. The equation is here:

https://www.fundmanagersoftware.com/hel ... gainf.html

One thing to note about starting points (startNAV in that equation) is that if you're running a report from 1/1/21 to 12/22/21 the startNAV is the closing price from 12/31/20 (not the close of 1/1/21).

If you're looking at returns (TWR or ROI), you can turn on logging, and it will show you all the values it is using, to help you see what is happening. Turn on logging at "Options / General Preferences... / Yields" and then run a report that calculates some yields, and then go to "Help / Logs / ROI or TWR Yield Calculation...".

I just looked at an example fund on Yahoo Finance, and they seem to have both dividend and capital gain information, although it is often delayed in getting posted.

If you still have some calculation questions, you can email or attach a sample *.dat investment file, along with the details of whatever you're trying to calculate, and I can try to reproduce it here, and maybe explain it more.
Thanks,
Mark
Fund Manager - Portfolio Management Software
Mark
Site Admin
 
Posts: 10531
Joined: Thu Oct 25, 2007 2:24 pm
Location: Chandler, AZ

Postby jstolzen » Thu Dec 23, 2021 1:32 pm

Ah - that probably explains it. Dumb user error on my part :)

I'll go play around with the numbers using the 12/31 closing NAV and see what I get.

(Missing the obvious..geesh).

BTW, I'm on FM Personal 2018. If I want to try Pro 2020 before buying, can I just use the Trial version and have it access my FM 2018 Personal data files or is something else needed since the versions are different? If I decide to purchase after trying, would it just be the $260 to upgrade from Personal to Pro, or would I need to pay 2018-2020 Personal upgrade of $49 then the Personal to Pro upgrade cost?

Thanks again.

Jim
jstolzen
 
Posts: 24
Joined: Sat Jan 14, 2017 1:44 pm

Postby Mark » Thu Dec 23, 2021 1:51 pm

Hi Jim,

FM 2020 will read in your data from FM 2018, but it uses a new file format, so once you save it, you won't be able to open it in FM 2018 again. You can create a backup in FM 2018 before using FM 2020 in case you decide you want to go back.

Yes, the upgrade from FM 2018 Personal to FM 2020 Professional would be just the $260. You don't have to also pay the $49.
Thanks,
Mark
Fund Manager - Portfolio Management Software
Mark
Site Admin
 
Posts: 10531
Joined: Thu Oct 25, 2007 2:24 pm
Location: Chandler, AZ

Postby jstolzen » Thu Dec 23, 2021 2:26 pm

Awesome..thanks.

Did some more tests and I can get the Return % to match what's in M* if I "buy" 1 share on 12/31/20 and then either enter or import every 2021 distribution. However - if I don't buy that 1 share, the 2021 distributions I import do not get included on the Investment Performance report. I guess that makes sense as FM is presumably reading that I don't own any shares of that investment, so any distributions of $X per share would not apply. That said, it'd be nice if there were a way to designate an Investment or sub-portfolio as a "benchmark" or something similar and have the distributions counted regardless so that it wouldn't be necessary to go back and enter purchase of a single share for every benchmark investment since those investments will presumably have 0 real shares..not a big deal but just a suggestion to make it easier to setup benchmarks.

Appreciate all the help.
jstolzen
 
Posts: 24
Joined: Sat Jan 14, 2017 1:44 pm

Postby Mark » Thu Dec 23, 2021 6:03 pm

Hi jstolzen,

When you enter a distribution, and don't own any shares you will get prompted for what distribution/share amount FM should use in calculations. When you do own shares, this isn't necessary, as it calculates the distribution/share based off how many shares you own on that date, and the value of the distribution.
Thanks,
Mark
Fund Manager - Portfolio Management Software
Mark
Site Admin
 
Posts: 10531
Joined: Thu Oct 25, 2007 2:24 pm
Location: Chandler, AZ


Return to Reports

Who is online

Users browsing this forum: No registered users and 1 guest

FundManagerSoftware.com | Search | Site Map | About Us | Privacy Policy
Copyright © 1993-2022 Beiley Software, Inc. All rights reserved.
cron