If I understand correctly, the old GUI showed a TWRR and the new one shows a MWRR. My portfolio has too many CFs, so I did not really calculate it with it but if that is the difference, this should be a small example to illustrate the difference between both approaches (I am not sure how to properly insert formulas in this chat, I used LaTex / there are online LaTex editors that would convert the formula to a more readable format, like this one: Online LaTeX Equation Editor):
Money-Weighted Rate of Return (MWRR)
The MWRR is calculated using the Internal Rate of Return (IRR) formula, which sets the net present value (NPV) of cash flows to zero.
Example:
Initial investment: -$1,000
Additional investment after 1 year: -$500
Final value after 2 years: $1,800
The formula for IRR is:
[ 0 = \sum_{t=0}^{n} \frac{C_t}{(1 + IRR)^t} ]
Where:
( C_t ) is the cash flow at time ( t )
( IRR ) is the internal rate of return
Plugging in the numbers:
[ 0 = \frac{-1000}{(1 + IRR)^0} + \frac{-500}{(1 + IRR)^1} + \frac{1800}{(1 + IRR)^2} ]
Solving for IRR, we get:
[ IRR \approx 13.86% ]
Time-Weighted Rate of Return (TWRR)
The TWRR is calculated by breaking the investment period into sub-periods and calculating the geometric mean of the returns for each sub-period.
Example:
First year return: (\frac{1200 - 1000}{1000} = 0.20 ) or 20%
Second year return: (\frac{1800 - 1700}{1700} = 0.0588 ) or 5.88%
The formula for TWRR is:
[ TWRR = \left( \prod_{t=1}^{n} (1 + R_t) \right)^{\frac{1}{n}} - 1 ]
This is one of the many versions we are trying to guess why and how the RoR is calculated, and the reasons why it differs (in my opinion inflates) the old way of presentation.
Honestly as long as the cash in hand and stocks in hand between the old and the new way tally, and I don’t lose money in accepting a marketing gimmick, it does not take away a cent from what I do.
All I have understood from the past few days is the RoR numbers look inflated and unreliable unless the underlying calculations are made public. It is not a straight forward guess to claim that we know how it is done and that it is correct.
This is my second experience with T212 when they have pushed changes on their customers without giving an option. The first time it was when it replaced the legacy app with the new app which I have eventually learned to live with but will never get comfortable with. But did it stop me from making progress? - NO!
T212 works hard in what it does with the system but not all their decisions are liked by their customers. We cannot treat them as our back office staff. Unless anyone finds that our investment value is incorrect and we that are losing money, lets move on!
Oh man, wish i didnt update phone app.
It was useful to see account value at top of screen with list of positions below, while driving and phone was in car stand.
Now have to press buttons and fiddle with it.
This is def a UI regression. Please put it back T212.
Please bring back the old return percentage. This rate of return is unnecessarily complicated and i can not see my actual return or i need to calculated it myself. Or at least put an option to choose.
Glad that the team are also looking at improvements and making changes to meet customer needs. However, the changes to the rate of return % would be good if this was a toggle option between new and old version. Some might find the new way more helpful, however I’m finding it confusing and prefer the previous one.
@Bogi.H also, is there a way to pull these calculations into a Google Sheet through API (or other) - hopefully that auto-update - at least every time you open the sheet?
Ideally, these would be in the app/web interface.
Maybe the portfolio performance idea I had with gain/loss per month, could include more figures like the ones mentioned in my previous comment, plus many others, which could be auto-calculated and auto-updated for us in real time on the app/web interface.
I don’t understand why the total value of your holdings has suddenly disappeared from the top left of the browser page when you were on Home screen and in Standard or Advanced mode, instead it now just shows the Trading 212 Logo and then 212 Invest or 212 CFD etc. Was a great way to simply see the value of your portfolio without clutter. Could click on it and see breakdown of Value and what funds were available, easy to add funds etc. Home screen less cluttered than other screens at times.
Doing Net Deposits - Available (Unused) Cash = Total Funds Currently Invested doesn’t seem to add up for my total invested.
Doing it this way, I seem to have a difference of ~14k invested.
I track my total invested between ISA/GIA on a spreadsheet and the only way I can seem to get close to my previous total invested before this update is by doing the following steps.
Net Deposits + Realised profit/loss + Total Dividends - Cash
The only way I can think of getting total invested is by going through each individual stock I own and subtracting the return from the current value of the stock. This would be time consuming indeed.
I’m baffled as to why there isn’t an option for both types of return.
You know what, I just realised you’re right!
It’s misses out on the profit you made that you reinvested.
You were totally right!
So in that case it has to be the second formula:
Because what it says is it takes the total value of your ISA (or Invest, whichever you’re in), and removes from it the unused cash, leaving you with the Net Deposit + profit made that you then reinvested/bought other assets.
Yes this would work too, but it is time consuming, I agree.
So yeah, then the Total Value - Unused Cash, should be both quicker and accurate.
The only difference might be FX fees, stampt duty, and the like (maybe).
I agree.
As suggested prior @Bogi.H a multitude of values and outputs, might satisfy everybody.
Provide an extensive list of calculations, this will make everybody happy.
Small performance display, user clicks on it, it expands to show more numbers, calculations, etc.
thanks!