Investment Portfolio Evaluation

This chapter deals with the periodic evaluation of an investment portfolio in terms of internal rate of return. After an initial section on date and time functions, the determination of the internal rate of return for non-integral time periods is developed. Usually a number of investment securities are held at the same time, which constitutes an investment portfolio. Spreadsheets can be used to keep record of holdings and transactions and to evaluate the periodic performance of a portfolio. In a larger portfolio there may be a number of such securities, which makes their manual removal time-consuming. The evaluation of the portfolio for the year takes place under the assumption that the securities of the initial holdings are bought at the prices at the start of the year, and the securities in the final holdings are sold at the prices at the end of the year.