Does anyone have any tricks to memorize all that mess ? I can’t tell if I don’t understand it or too tired of memorizing to make a valid effort for that section.
Pretty straight forward.
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Contributions and withdrawals - people putting money in and out of the fund. Doesn’t relate to investment performance but does increase or decrease ending value.
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Risk free rate - if MVo and contributions were solely invested into a RF asset.
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Asset categories - incremental returns over RF rate if MVo were invested according to the exact policy of the fund (I.e. with the fund’s benchmarks and proper weighting).
1-3 represent passive returns from the fund’s perspective.
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Benchmarks - this is essentially the style return of the managers. They will get different benchmarks from the overall fund that fit their style. It is incremental return over #3. This can also be earned passively but it requires active decisionmaking on the fund’s part and therefore its active returns to them.
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Investment management or active returns. This is the incremental value added or lost based on the specific managers out/underperforming their specific benchmarks.
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Policy allocations - a plug because typically the fund’s aren’t invested perfectly as it relates to the fund’s policy.
4-5 is active returns from the fund’s perspective relating to style and active management. 6 just rounds it all out to equal MV1