How do I choose relevant decision price in calculating realized profit/loss ? The example given in schweser has taken the previous day’s closing price as relevant decision price. Is this always the case?
Also, the benchmark price is always the decision price or is it based on any assumptions?
Thanks in advance…
Sometimes they will give a benchmark price explicitly ( by saying the desk had a benchmark price of XXX ). If they don’t mention it, then it is the close of the day they placed the order ( usually can’t trade then ).
More ambiguous is when they say that the model price was X , and the price when the order was placed is Y .
In that case CFA can have my points , and I don’t care