Comments on: Flexo’s Investment Portfolio, 3Q 2009

By: Flexo

Flexo — Mon, 05 Oct 2009 22:34:39 +0000

I don’t think I’ve come across major problems with the calculation but I’ll run a test with a simple IRR when I get a chance.

By: Shadox

Shadox — Sun, 04 Oct 2009 16:33:00 +0000

Like it me, it looks you continued to invest into the stock market crash. Sure paid off.

I have noticed some problems with Quicken’s calculation of return. For example, it considers new investments during the calculation period as gain. Did you notice the same thing or am I doing something wrong? I completely ignore the return calculations in Quicken because of this problem.

By: David M

David M — Sun, 04 Oct 2009 15:12:02 +0000

Flexo,

Thanks for taking the time to reply! in detail!

By: Flexo

Flexo — Sun, 04 Oct 2009 14:35:22 +0000

David: The Real Estate Fund is one that I am investing in throughout the year. So the increase in the overall value is mainly due to my investments into the fund. In other words, I kept adding more as the investment value continued to fall. So even though the *total* value of the account has increased, the price of a share has decreased.

The average annual rate of return is an internal formula that takes the cash flow into account. On January the price of one share was around $10, on October 2, the price was about $7 per share. I kept buying throughout the year as the price decreased, so my shares from the beginning of the year have performed worse as of 3Q than the more recent purchases. The AARR formula takes that into account.

By: David M

David M — Sun, 04 Oct 2009 14:20:09 +0000

The negative 34.6% return for your real estate fund does not appear to be correct as the ending number is the highest number on the chart.

By: Financial Samurai

Financial Samurai — Sun, 04 Oct 2009 14:17:44 +0000

Hang on for a tough October!