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Date:	Fri, 18 May 2001 10:17:02 PDT
From:	Peter Skye <pskye@peterskye.com >
Reply-To:	scoug-sundialsig@scoug.com
To:	scoug-sundialsig@scoug.com
Subject:	SCOUG-SundialSIG: Initial Offering

Content Type: text/plain

John Hlavac wrote back on Monday May 7:
>
> I'm back, fresh from my visit to the Pacific Crest Trail.

I was up there on Sunday May 6, in the Angeles National Forest. Only
hiked 9 miles (there was snow). Where were you?
_____

[John attached a Mesa 2 spreadsheet.]

Good spreadsheet. Can I make a suggestion? Can you split the
information into two parts, so the % return info (the left-side columns)
is on one page and the $ detail info is on a separate page (with dates
going down, not across)? It will be easier to add more displays if you
do this (and will also be easier to print).

> Right off the bat there's a problem. The Roth IRA has
> a fairly common problem. Each year's contribution
> gets wrapped into the interest increase. How does
> one deal with continuing contributions to a fund?

You need to also post to the spreadsheet what the contribution amount is
and the date it is made. Then it's possible to back out the
contributions and "approximately" determine the true % return. (You
can't determine an "absolute" true % return because you don't know the
value of the account on the date that the contribution is made. If you
_do_ know the account value on the contribution date, then you _can_
calculate the "absolute" true % return.)

Suppose you're calculating the 5YEAR%. Start five years ago and
calculate as-best-you-can the account value on the date of your next
contribution, then calculate the rate of return for just that time
period. Calculate the rates of return for all other time periods as
well ("time period" being the time periods between your contributions).
You can now compound the individual rates of return into one overall
rate of return (this is easy if each time period is the same number of
days, more complex if the time periods have different numbers of days).

- Peter

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