(03-09-2014, 09:50 PM)CityFarmer Wrote: [ -> ] (03-09-2014, 06:11 PM)cyclone Wrote: [ -> ]Hi Shrivathsa,
I do not use XIRR to compute the return, instead I use NAV per unit method.
I try to compute at the end of each month if I'm free.
NAV per unit at the beginning of CY2014 was 1.297122.
NAV per unit at 2014/08/31 was 1.288124.
So it was still underwater.
There were some distributions during the period. All dividends received were plowed back into the "fund".
If we excluded the distributions, NAV per unit would be 1.432362.
NAV is lower with dividend included, and higher with dividend excluded? It means all dividends were re-invested at higher price, and remain "underwater", right?
Hi CityFarmer, this is how I calculate NAV per unit, not sure whether the methodology is correct or not.
SUPPOSE :
At the beginning of CY2014 :
Number of units = 30000
Cash = 7000
Stock A = 10000 x 0.6 = 6000
Stock B = 20000 x 0.4 = 8000
Stock C = 30000 x 0.3 = 9000
NAV = 7000 + 6000 + 8000 + 9000 = 30000
NAV per unit = 30000/30000 = 1
At the end of May 2014 :
Received dividend from Stock A = 10000 x 0.03 = 300
Received dividend form Stock B = 20000 x 0.02 = 400
Received dividend from Stock C = 30000 x 0.02 = 600
Total dividend received = 1300
Cash = 7000 + 1300 = 8300
Assume the stock price did not change.
NAV = 8300 + 6000 + 8000 + 9000 = 31300
NAV per unit = 31100/30000 = 1.04333
At the end of July 2014, we needed the money and distributed out 4000 from available cash to unitholders :
Cash = 8300 - 4000 = 4300
Assume the stock price did not change.
NAV = 4300 + 6000 + 8000 + 9000 = 27300
NAV per unit = 27300/30000 = 0.91
At the end of August 2014 :
Due the stock price changes
Cash = 4300
Stock A = 10000 x 0.71 = 7100
Stock B = 20000 x 0.39 = 7800
Stock C = 30000 x 0.35 = 10500
NAV = 4300 + 7100 + 7800 + 10500 = 29700
NAV per unit = 29700/30000 = 0.99
NAV per unit at the beginning of the year = 1, NAV at the end of August 2014 = 0.99, so it was still underwater.
If we exclude the distribution to unitholder of 4000, NAV would be 29700 + 4000 = 33700 and NAV per unit would be 1.12333