Trading Activity Return

Whe we see a list of things describing performance

Interest Rate management effect - yield positioning, duration management, etc

other management Effects - Security selection, sector selection, etc…

and “trading activity return”

What is “trading activity return”?

It’s probably the attribution to the Transaction costs (Plug number)

transaction costs are part of other management effects already.

trading costs are outside. It is the Total Portfolio Return - Sum(All other effects) plug number - as L3Crucifier says. It is the impact of Sales / Purchases on Total Portfolio Return.

  • but the two are different. In the table presented in the book Transaction Costs are 0, but Trading Costs for the two managers are different.

So that is just a filler? Im asking becasue i dont want to get poked in the eye by some comparative question where one manager made his money on 'trading activity"

As described on P169(bottom), it captures the effect of buy/sell of bonds over the period. As you said, it’s just a plug number.