Performance Benchmark

Jeanne Tieken on

I was looking at our Performance Benchmark. I love it. But it does not seem to include dividends we received. Am I correct? If not, why not?

Laurie Frederiksen on

Hi Jeanne,

Dividends are included. What is it that you are looking at they makes
you think they're not?

Laurie

Jeanne Tieken on

I was looking at the "members contribution" column. Almost all are in whole dollar figures, while many of our dividends were in partial dollars (i.e., 10.45). Looking down the ist, I do see some member contributions that are NOT whole dollar figures. Maybe those include dividends.

On Tue, Nov 9, 2010 at 9:18 AM, Laurie Frederiksen <laurie@bivio.biz> wrote:

Hi Jeanne,

Dividends are included. What is it that you are looking at they makes
you think they're not?

Laurie

Jeanne Tieken on

I was looking at the "members contribution" column. Almost all are in whole dollar figures, while many of our dividends were in partial dollars (i.e., 10.45). Looking down the list, I do see some member contributions that are NOT whole dollar figures. Maybe those include dividends.

On Tue, Nov 9, 2010 at 9:18 AM, Laurie Frederiksen <laurie@bivio.biz> wrote:

Hi Jeanne,

Dividends are included. What is it that you are looking at they makes
you think they're not?

Laurie

Laurie Frederiksen on

Dear Jeanne,

Now I understand. Very good question and good observation.

When you contribute to your club, you are investing in your club.
The performance benchmark report lets you compare the rate of return
you are achieving when your members invest in your club to what you
would have achieved if you had invested the same amounts at the same
times in something different. For example, you can compare the rate
of return you would have achieved if you had invested the same amounts
on the same dates in the Vanguard Index 500 fund rather than your
club.

When your club receives a dividend, it is not an investment by your
members or a distribution from your club. Instead, it increases the
total value of your club just as changes in stock prices do. It
contributes to the rate at which your club value is growing. The
dividends you've received are included in the total value of the club
on the dates being used to calculate the rate of return. So they're
there, they just don't show as cash inflows.

Hope this helps. Please continue asking questions if you need further
clarification.

--
Laurie Frederiksen
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