Return YTD% Wrong in Investing Center? HELP!!

You are right. It all has to do with the internals of Quicken (read about Internal Rate of Return calculation which is used for YTD %). DO NOT TRUST the numbers in Quicken. They cannot be used for comparining different securities.

Quicken's Return YTD numbers have been wack-o for as long as I can remember (I've been using Quicken since 1992).

(I've been using Quicken since 1992).

Thanks..so, what do you guys do to guage relative performance of your investments (IRAs, Mutual Funds, etc)? Is there something else other than Return YTD to use? Or, do you just punt altogether on Quicken for this and use a different app?

It's mind-boggling that Q has this kind of bug. This (and all the other dozens/hundreds of bugs) make it virtually unusable, IMHO. But Money doesn't sound a whole lot better. As I've been in the software biz for

20+ years, it's completely baffling that they can still sell a product that has this lack of quality and apparently haven't prioritized fixes for the more nasty bugs. I mean - it's not hard to go fix something like this, and you think the user base would think getting accurate YTD #s for their investments is kinda important..

JS

I don't have a pony in this race, but I would suggest that Intuit may not regard this a a bug. In all likelihood, they feel that Quicken is calculating financial numbers correctly according to their formulas and calculations. It is, after all, relatively trivial to test these types of calculations.

Well, post the year beginning value, the current value, all securities buys and sells, and all deposits and withdrawals...because I would calculate two different Modified Dietz approaches in a situation like this.

A Count,

What are the two different Modified Deitz approaches? I know of only one.

You ask for "HELP!" in your title, but you give us nothing to work with. How do you expect us to help you if you don't provide any data?

In my experience, Quicken's YTD% is correct. Let us know your opening balance, cash flows and ending balance so we can help you understand how it's being calculated.

I weight deposits and withdrawals for the full calendar year period and give a YTD result from that.

For a calculation on (say) July 1 other calculations might weight in a six month period and give a result.

That's what I would do, but Quicken doesn't. To demonstrate, "buy" a security and display it in a portfolio view. Add the "Return YTD" column. You'll notice that it will show "N/A" until you have owned it for a year and a day.

The reason is Quicken uses its Internal Rate of Return calculation is used and if you rumble around in the Quicken documentation, it says that this requires the price on the day before the period begins and the day the period ends. Somebody decided that YTD means a full year must be used. But that's not true because you can caculate a return for even one day and if you like, scale it up to a full year.

A friend contacted Intuit about this. They were a bit shy and said something like, "It's ways been like that and nothing has changed. So, it has to be right."

Calculate a return for one day and scale it up to a year ?

Okay, as long as you are not suggesting an annualization...And I would say that if Q also avoids annualization then it is probably reasonable.

But I'll do a three day return to demonstrate what I suggest.

Jan 1 Beginning balance 1000 Jan 2 Deposit 1000 Jan 3 Current balance 2100

The new deposit will be in the account for 364 days of the year (and any opposite change in that situation can be reflected with a time weighted withdrawal). So the weighting of the deposit is 364/365 * 1000 or 997.26. Now the portfolio gain is 100 / 1997.26 or 5.0069 % .

Now I'll try an alternate method:

The deposit will be in the account for 2 days of a 3 day period. That's

0.6667 * 1000 = 666.67 for the weighting . The gain is 100 / 1666.67 or 6.0000 % .

Well, I use the first method. I say that it projects to year end and of course any additional deposits or withdrawals are just new weightings projected also to year end...

This is just a simple per cent gain. It's not a measure of performance as would be a rate of return. The former doesn't consider time, the latter does.

Not quite. The original $1000 on Jan 1 sees 3 days of gain. The deposited $1000 on Jan 2 sees 2 days of gain. The interest of dividends amounted to $100 so you have to say which of the 2 $1000 amounts generated how much of the $100 before you can weight it and figure out a return rate.

Now, it really doesn't matter. For investing you don't want to worry about differences in the 3rd decimal place when the NAV of the securities might change 10% on any one day. But you need to think about T-bills returning 3% (?) and junk bonds returning 20%.

No, I don't find the response to be helpful...because in a ratio it's only necessary to scale one of the parameters...and the ratio here is fundamentally gain divided by balance.

Oh, I missed this gem of a response...

A simple percentage gain would be 100 / 2000 not 100 / 1997.26 . The reason that they are so close is that this is a three day period of the year at the beginning of the year and a relatively small gain. The purpose of carrying the result to four decimal places was so that it is obvious that it is not a simple percentage gain calculation...

Also, the balance of 1997.26 resulting by weighting with number of days and days are time element...It is a Modified Dietz (for the year end but presented at YTD) and a Modified Dietz is a time weighted return calculation.

Could it be that Morningstar is assuming all dividends and cap gains reinvested and you are not reinvesting? That would not be a bug.

But Quicken will not give you YTD in the portfolio view if you bought the security this year. Really stupid isn't it? MS Money will oblige you on this, however.

If you click on the security and drill down the number shows up IRRC.

The YTD function worked in Q03 but is hosed in Q04 and Q05. It's a defective product although useful. I bought the premier version for it's much-hyped (by Intuit) investment management capabilites. Silly me....I expected it to be fully-functional.

I did a test conversion to Money 2006 and the investments converted without flaw but the other accounts lost their associated categories so I am not too interested in switching. Money does give the YTD for all my investments.