UHNW Portfolio Management Pet Peeve of the Day: Inaccurate Performance Calculations

Calculating performance based on daily return is the most accurate way to report on an ultra-high net worth (UHNW) portfolio. However, many portfolio management systems calculate performance based on approximation. The difference between the daily return method and the approximation method can be drastic. If you are seeing errors in your performance calculations, they will only compound over time – resulting in performance calculations that are off by 10 to 20 percent. This leaves wealth owners frustrated by inaccurate investment data. As a result, investment and operations teams are increasingly looking to new portfolio management technology to set a better standard for accuracy.

In our latest installment of the “UHNW Portfolio Management Pet Peeve of the Day” video series, we explore how UHNW portfolio management technology that calculates performance based on trade date can help UHNW individuals, family offices and banks produce more accurate performance reports and enable teams to make better investment decisions.

Our UHNW Portfolio Management Pet Peeve of the Day video series touches on some of the most common pet peeves we hear from UHNW investors, family offices and private banks. We offer tips on how to improve your portfolio management technology and process framework to set a new, better standard for portfolio data accuracy. If you’re interested in seeing more from the series, watch our other videos: “IRR Calculations,” “The Trade Date vs. Settlement Date Dilemma,” “Data Normalization Errors,” “Lack of Investment Reconciliation,” “Private Investments on Custodial Platforms,” and “Manual Intervention to Fix Inaccuracies.”


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