Growth of $10,000 Graph
Hi,
Does anyone know if this chart is smart enough to exclude withdrawals / deposits made in my investment accounts? Thanks!
Best Answer
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To restate @Jim_Harman ‘s caution, the growth shown in the chart is not accurate if you have significant deposits or withdrawals from the collection of accounts and securities being graphed.
What is significant? I do not know of a specific value as a make or break line, but my sense would be about 5%. That is, if the additions or withdrawals exceed 5% of the original grouping value, the error might be noticeable.
But another very key factor would be timing. Such changes early in the selected time frame will have a more significant effect than late changes.
I tend to rely on Average Annual Return values (Investment Performance Report) compared to published data for the comparable period.
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Answers
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Yes it excludes deposits and withdrawals but it does not compute the growth correctly. This is obvious if you make a large purchase just after the start of the period and the price changes. See this discussion.
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Thanks very much. I am a bit confused then with the comparison with indexes. Am I beating or matching the indexes or what? Or is it that I shouldn't give a [Removed - Language] because it's worthless? What do I compare my performance with in Quicken? Thanks again.
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To restate @Jim_Harman ‘s caution, the growth shown in the chart is not accurate if you have significant deposits or withdrawals from the collection of accounts and securities being graphed.
What is significant? I do not know of a specific value as a make or break line, but my sense would be about 5%. That is, if the additions or withdrawals exceed 5% of the original grouping value, the error might be noticeable.
But another very key factor would be timing. Such changes early in the selected time frame will have a more significant effect than late changes.
I tend to rely on Average Annual Return values (Investment Performance Report) compared to published data for the comparable period.
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Thank you!
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