Page 74 - Profile's Unit Trusts & Collective Investments - March 2025
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CHAPTER 3
to the end of the last quarter while a daily paper or website might show a three-year return
up to the most recent trading day.
Are you looking at absolute returns or annual returns (ie, average percentage per year)? If the
returns are average annual returns, are they compounded annual returns? The difference
between a simple annual average and annual compound returns can be significant (see The
Power of Compounding on page 35).
Does the calculation include reinvestment of distributions? Are dividends reinvested, for
calculation purposes, at the ex-div price, or at the price ruling on the distribution payment
date?
In the event of large discrepancies in reported performance figures for a fund, check for
unusual stats, such as inflation-adjusted performance (sometimes called “real returns”), or
performance relative to a benchmark, or rolling period calculations.
72 Profile’s Unit Trusts & Collective Investments — Understanding Unit Trusts
