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Strategies & Market Trends : Young and Older Folk Portfolio
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From: garygr12/15/2025 5:44:32 AM
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Personal Returns--Morningstar

My returns for one of my accounts in Quicken is up 10% YTD. Quicken shows YTD return $40,000, amount invested YTD $400,000, Return YTD 10%. Easy clear data.

Same identical portfolio on Morningstar. Amount invested YTD, Gains + dividends all agree with Quicken, and YTD returns show 19%. This is the explanation given in "M".

I'm sure SeeksQuality and other understands how "M" computes personal returns, but WTF?????????????????
I'm not renewing my yearly subscription to "M". I've had it!!!!!!!!!!!!!!!!!!!!


Personal Returns
Personal Returns measures the actual return earned based on the beginning portfolio value and on any net contributions made during the period. Therefore, how an investor exercises control over cash flows is crucial in assessing their investment skill. Once again we will demonstrate using the table from above, but apply the Personal Return methodology to the figures.
On a more technical note, the true definition of the Personal return is the discount rate that equates the cost of an investment with the value of the cash generated by that investment period. So, by setting the above equation to 0 the result will provide the value for “r”, which represents the discount rate that will provide a net present value cash flow equal to zero.

The final step to Personal return is:

To make the point even clearer if we were to reverse the order of the (%) gain or loss by quarter you can see how the Personal Return is adversely affected by smaller returns on the larger initial balances.



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