SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Strategies & Market Trends : Picks of the quarter -- Ignore unavailable to you. Want to Upgrade?


To: Kirk © who wrote (9372)4/21/2010 5:08:05 PM
From: Sr K  Read Replies (1) | Respond to of 20435
 
>> so if you entered 5 times and beat it by 1% four times and under performed by 4% on the fifth time, you come out to matching the S&P500... <<

that doesn't look right unless the length of time from the investment (not necessarily the start of the game) to the end of the game (in days) is the same for all 5 games.

You have to adjust the raw data for the length of time for each investment and for the index change over that number of days.

Measuring performance versus any index is not simple. And you might not count cash until it is invested.

If the S&P is down 10%, and you are down 6%, would you call that beating the S&P by 4%? Or comparing 94% to 90%, beating it by 4.44%? If you seek a number that compares 2 levels of funds, it would be 4.44%.

And if a player is up 10%, and the S&P is up 6%, would you call that beating the S&P by 4%? Or comparing 110% to 106%, beating it by 3.77%?

If you seek a number that compares 2 levels of funds, it would be 4.44% in the declining example and 3.77% in the rising example.