2 new charts - Fund performance attribution
How does each holding contribute to overall performance?
The aim of investing in a fund or ETF is to not have all your eggs in one basket. Popular ETFs like SPY or VOO were created to invest the 500 largest US companies, while others like VWRL or INRG invest in the global economy or in clean energy respectively. With 2022 being a rollercoaster of a year, how did these popular funds do and were there any outliers?
The S&P 500 contains the 500 largest US companies, and VOO is one of the most popular ETFs available that tracks it. Here we look at how each sector performed individually, as well as how they contributed to the overall performance of the fund. You can see that despite the Energy sector’s high-flying performance, it wasn’t enough to bring up the overall fund performance by any significant amount as almost all the other sectors underperformed by a large amount - resulting in an overall performance of -18.13%.
Pershing Square is run by famous investor Bill Ackman, and only tracks a handful of stocks as opposed to the S&P 500. However, just like the previous chart the good performance of one holding has little to no effect on overall performance, with the fund ending 2022 down by -12.24%. A sizeable proportion of the fund is also held in cash unlike VOO which only contains equity.
Today’s Genuinely Impactful startups:
Olio - Borrow, share and giveaway free stuff and household items with your neighbours. Reduce waste, declutter your house and borrow a drill to finally hang up that picture on the wall - all for free!
Logically - Misinformation is rampant everywhere on the web. With Logically, you can fact-check anything and everything with the aid of AI and real-life experts.
See you on Friday with more charts on sports!
Created by Miguel
Thanks for reading our newsletter! Make sure you’re subscribed below.
Genuine Impact Limited is an appointed representative (FRN 976025) of New Horizon Global Advisory Limited which is authorized and regulated by the Financial Conduct Authority (FRN 927966).
Genuine Impact helps you understand the different investment options before you decide for yourself how to invest your money. We do not tell you what to do or which products to buy. We have not assessed your investing knowledge and experience, your financial situation, or your investment objectives. Therefore you should ensure that any investment decisions you make are suitable for your personal circumstances. If you are unsure about the suitability of a particular investment, you should speak to a suitably qualified financial adviser.
Remember that investments can go up and down in value, so you could get back less than you put in.