This guide provides information on how performance returns are calculated for Macquarie Wrap reports and statements. The reports and statements that include performance data are:
Super and pension annual and exit statements
Macquarie Wrap provide performance reporting at three levels:
The Portfolio Review Report (PRR) can be used to provide information for a group of accounts. This will help you produce an online overview of account activity for a group of clients over a period.
You can also search for account groups and generate reports for any ad-hoc groups you create.
Note: You may notice some differences between the figures on the PRR and the Performance page in Adviser Online. Adviser Online only should be referenced for account level performance, and the PRR should be used to calculate performance on a group of client accounts.
You can locate a comprehensive view of your client’s account-level performance on the ‘Performance’ page in Adviser Online:
You can locate a comprehensive view of your client’s security-level performance on the ‘Performance’ page in Adviser Online:
MWRR is a percentage that measures the performance of an investment or a portfolio by considering the timing and amount of cash inflows and outflows.
MWRR calculations are generated as at the date of the report, for the time period requested.
Account-level MWRR calculation
(Closing portfolio value - Opening porfolio value - Net Capital Flows) / (Opening portfolio value + Sum of the Weighted Capital Flows)
Security-level MWRR calculation
(Closing value – Opening value – Net Capital Flows) + Income accrued] / (Opening value + Sum of the weighted Capital Flows)
TWRR is a percentage that measures the performance of an investment irrespective of the amount invested, effectively measuring the performance an investment would have obtained had the personal cash flows not occurred. The weight of the personal cash flows invested at any point in time doesn’t impact the final return calculation. As such, TWRR is generally comparable to benchmark indices.
TWRR calculations for all investments are calculated daily to obtain the most accurate results. The daily figures are then compounded to obtain returns for any required period.
TWRR calculation
(Closing portfolio value – Opening portfolio value – Net Capital Flows) / (Opening portfolio + Net Capital Flows)/2)
‘Distributions’ includes an income that is derived from fixed interest assets including term deposits and managed funds, as well as other assets that fit into the two categories.
In contrast, ‘dividends received’ includes income derived from instalment warrants and listed securities, as well as other assets that fit into the two categories.
Accrued income is taken into consideration when calculating the performance except where income distribution occurs on the report end date. Where the income distribution occurs on the report end date, the accrued income isn’t considered in the performance calculation.
Note: Where income distribution occurs on the day prior to the start date of the performance report, the performance will be calculated using a higher opening value. This is due to the cumulative price being used and the accrued income from the period prior not being considered in the calculation. This income isn’t considered as the income was accrued outside of the reporting period.
Franking credits aren’t factored in our performance reports. However, for super and pension accounts the capital flows calculation includes any tax-related cash transactions such as contributions tax, tax on income, tax credits on fees, and PAYG tax.
Income return = Total income received for the period selected / Closing portfolio x 100
Market movement represents any unrealised growth. It also acts as a balancing figure and is calculated as follows:
Market movement = Closing balance – Opening balance – Capital inflows – Capital outflows – Income – Expense – Realised gains.
Please note: Unlike Adviser Online and other Wrap Online and statement reporting, the PRR doesn’t contain a market movement figure.
Net earnings tax is composed of tax on interest paid, tax on distribution income, dividend income, tax on rebates, tax credits and any tax calculation adjustments.
Net Capital Flows = Additions – Capital outflows
Sum of the weighted Capital Flows = Sum of [Capital Flows x (Days in Period – Days of Cashflow in Period)] / Days in the period
The PRR report allows the report to be generated using a start date before the date that the account was funded. This can impact the performance calculation. Adviser Online performance reporting will use a start date from the date the account has been funded.
The PRR includes non-custodial assets in the performance calculation. Adviser Online excludes these assets in the performance calculation for Macquarie Wrap products and includes these assets for Macquarie Vision products.
The PRR system logic calculates performance on residual parcels after a client has sold out of an SMA. The Adviser Online performance is based on the actual SMA holdings for the period (it doesn’t calculate performance on residual parcels).
In certain cases, the TWRR for a superannuation or pension account may be temporarily impacted if a managed fund switch occurred in the account late in the month. This doesn’t impact IDPS accounts.
Chat in real-time with an adviser consultant Monday to Friday, 8am to 7pm Sydney time (excluding public holidays).
Everyone at Macquarie is commited to providing our clients with the highest standard of products and services available. If you have feedback we would like you to tell us about it.
