I know this may be a dumb question but how do you go about calculating your account performance when it isn't cut and dried (start with funds, trade and end with funds)? What I mean is, when you have additional deposits to your account and/or withdrawals as well as profits/losses during multiple time periods (years)? Currently I'm using the XIRR function in Excel but I'm not sure if it is correct or perhaps the best way. With XIRR I start with a negative (starting capital) then put any withdrawals as negatives and any additions as positives. Then the monthly profits/losses from trading are also +/- along with the corresponding dates. Then end with the current acct balance as a positive. Like this: 11-Apr-01 -$100 starting capital 15-May-01 $55 trading profit 15-Jun-01 -$75 withdrawal 15-Jul-01 $5 trading profit 15-Aug-01 -$75 trading losses 15-Sep-01 $35 addition to acct 15-Oct-01 $20 addition to acct 15-Nov-01 -$12 withdrawal 15-Dec-01 $15 trading profit 31-Dec-02 $120 ending capital =XIRR(A1:A10,B1:B10) How do you calculate this? TIA
One suggestion: calculate a starting NAV value for your performance. When you add or withdraw money, think of it as buying/selling shares at current NAV value.
Biog, I was just making an example and plugging in numbers right and left without a care I guess you can say between Dec 15 '01 and Dec 31 '02 there was some more profit/losses. Anyway, it was just an example!!
I changed the 1st and last number for this example of a way to calculate NAV with additions and withdrawals: 11-Apr-01 +$100 starting capital NAV:$10 /10 shares 15-May-01 $55 trading profit NAV: $15.50 /10 shares 15-Jun-01 -$75 withdrawal NAV: $15.50 / 5.16 shares 15-Jul-01 $5 trading profit NAV: $16.47 / 5.16 shares 15-Aug-01 -$75 trading losses NAV: $1.94 / 5.16 shares 15-Sep-01 $35 addition to acct NAV: $1.94 / 23.20 shares 15-Oct-01 $20 addition to acct NAV: $1.94 / 33.51 shares 15-Nov-01 -$12 withdrawal NAV: $1.94 / 27.32 shares 15-Dec-01 $15 trading profit NAV: $2.49 / 27.32 shares 31-Dec-02 $68 ending capital NAV beginning: $10.00 NAV Ending: $2.49 -75% Just an idea for calculating...
Babak, Hi. Why do you ignore me? I respectfully asked a question. Even Johnny Rotten answers all questions. I really want to know what happened to your journal. Why did you stop? Please don't be rude. Thank you.
From what I recall reading in the forums, Aaron Schindler seems to have a grasp on how to perform these types of calculations.
BABAK- I asked the same questions about a year back. Do a search for that link. Or better yet, just PM Aaron. He answered all my questions on the subject. Good trading.