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Strategies & Market Trends : Value Investing

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To: Paul Senior who wrote (63106)	1/8/2020 7:41:33 PM
From: Grommit	Read Replies (2) of 78740

>>>I've no idea how brokers figure results. I add up all accounts on Jan 1. I keep track of withdraws and adds and +/- them to the starting balance to = "adjusted basis". And compare the 12/31 total to that. Simple. example: starting , all accounts = $1,000 (= "new basis") adds $000 outs ($200) "adjusted basis" = $800 ending value $880 what is the gain over the year. I call it $880 - $800 = 80. the problem is the divisor. 80 / 1000 = 8% or 80 / 800 = 10% or 80 / 900 = 9% ??? i adjust the divisor. If I withdraw $200 early in the year, then $800 seems appropriate -- that is what i had near the start. that is the approx amount "working" all year. if i added $200 in january, I'd divided by $1,200. i'd use $1000 if the $200 withdrawal was near year end, because you had $1,000 invested and working during the year. if it is withdrawn evenly during the year, then averaging $1000 and $800 = $900 seem fair. or you could get more accurate by doing some more complicated arithmetic. average the monthly calculated numbers or something. if things were really large and lumpy, that might be best. if the +/- are small, it doesn't matter much.

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