News and Updates
Performance Calculation Methods
Panoramix™ Industry Content Series
Welcome to the third in our series of industry content from Panoramix designed to help advisors succeed in a more challenging operating environment.
As one of the more common processes developed in advisory firms, there is a high level of interest by both advisors and clients in how investment performance is actually calculated. While it seems straightforward in determining the ups and downs of a portfolio, there are quite a bit of assumptions and factors that take into consideration; time periods, account values, deposits/withdrawals, as well as the actual performance of the underlying investments in a portfolio.
On the surface, it may seem straightforward in how these calculations are developed, however, there are often many areas and methods that are not as understood and can become a source of confusion as advisors select a method for providing this critical information to clients, regulators and other industry bodies such as GIPS. In order to provide a detailed reference for the methods of calculating performance, this latest report will examine the different methods of computing portfolio performance, and some of the pros and cons of each method. There is no “right” choice for how you compute performance, but advisors should be familiar with the different methods so they can adequately defend their choices.
Sapphire Software Services inc., a custom software and business-to-business automation company founded in 2003, developed Panoramix® for financial advisors in 2013 and completes 16 planned releases per year to the product. Sapphire brings business applications to the web, provides consulting services with the best vendors and partnerships, and offers professional development capabilities to automate business processes. Sapphire specializes in business application software development for companies in the financial services sector. Panoramix, its award-winning flagship software tool for portfolio management for financial advisors, focuses on providing multi-custodial performance reporting and client billing, with a wide-ranging additional feature set. Sapphire markets under the name Panoramix Financial. For more information on Panoramix connect with us at www.panoramixfinancial.com.
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