Page 78 - Profile's Unit Trusts and Collective Investments 2021 issue 2

CHAPTER 3

Are the different figures calculated
over the same period? A fact sheet
might quote a three-year return 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 40).
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.

76 Profile’s Unit Trusts & Collective Investments — Understanding Unit Trusts