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KL asked 4 years ago

Hi Rusmin,
When come to managing our own portfolio growth and portfolio return over the years, how should we measure it? Do you have recommendation tool?
How should we accurately measure the overall portfolio growth & return % given that there are many additional investment and divestment during the period, says 5 years? And, also considering the dividend received in cash.
Another question on capital allocation, should we include unit trust investment, FD & available for investment cash  as part of the portfolio capital when determine how much portfolio % has been allocated to a particular invested stock? Or, should we only take the stock portfolio out of total portfolio, and determine the % of a single stock from the stock portfolio?
Thank you.
 
 
 

1 Answers
Victor Chng answered 4 years ago

Hi KL,

1.You can measure performance based on the number of shares. For instance, your initial capital is $100,000 and you issue 100,000 shares to yourself. This will make your starting NAV to be $1. When your NAV increased to $2 and you decided to inject another $100,000 capital. The new share issue will be 50,000 ($100,000/$2). Based on the NAV growth, you can measure your return and performance.

 

2.Yes you can include unit trust into your allocation. The important things is to make sure that every investment you made are consistent percentage. We usually suggest a stock holding from 10-20 stocks. You have to decided yourself what amount of stock you want to invest in. For instance if you decided that the total number of stock is 20, then each stock percentage will be 5% (100%/20).