Hopefully there’s some pearls of wisdom out there in relation to this query!
In theory, the capital gain for a particular stock should be (Closing Value - Opening Value) - Purchases + Sales. To work it out as a percentage, you would divide that gain by the capital you had invested in the stock. Sharesight seems to define the denominator as (Opening Value + Purchases). I think in theory, it should be Opening Value + Purchases - Sales, but you might end up with a silly result like -100% if you had made a full sell down. I have tested out this theory on my portfolio, over 60+ monthly periods, and stock-by-stock this is how Sharesight has calculated the capital gain %. And it seems right to me.
But…if I apply this approach not to an individual stock, but to my whole portfolio, it doesn’t work. The capital gain % reported on the ‘Grand Total’ line is worked out differently. I think it’s using a different approach for the denominator. Rather than using the grand total (Opening Value + Purchases), it’s doing (Opening Value + Purchases - Sales + Add back Sales in respect of any fully sold down security). But then, in some months, it does that and in other months it doesn’t.
Which is frustrating, as my overall portfolio % return is more important to me than whether Telstra under performed BHP!
Is there a document anywhere explaining how this is all calculated?