There
were some interesting questions that came up during Saturday’s Webinar
on Benchmarking Your Portfolio. One person asked whether it was a good
comparison when their financial advisor gave them a rate of return he’d
achieved for their investments and gave them, as a comparison, the
return for the S&P 500 for the past year.
The
answer to this is that it’s not the best comparison. It is much
better to compare in the way the bivio report does, where actually cash flows
into the two investments are the same.
In
addition, if someone tells you a rate of return for something, make
sure to find out whether dividends are included. They will probably
bump up the rate of return and therefore the comparison may not look quite as
good as it did initially.
For
anyone who would like to see the presentation that was given Saturday.
You can find it on the bivio library page. www.bivio.com/hn/library-faq.html