Portfolio analyses

We have analyzed your portfolio and on this page you’re able to see the past performance, the expected return, and the portfolio volatility.

Historical portfolio return
The table below shows the historical return for the last 1 year and the beta for each of the securities currently in your portfolio.

Expected portfolio return
When looking at expected return there are many models being used to make predictions for the future of which the below to are dominant:
– historical average return as an estimate for the expected return, though this isn’t a predictable model as volatility divided by square-root (year) leads to confidence bounds too high to accurately estimate the return. In particular with only 5 years of data, so based on our experience we didn’t use this model.
– CAPM model-based on the asset pricing model, which is the preferred model we work with as it imposes a disciplined process to identify the cost of capital to calculate expected returns whereby assumptions are straightforward and documented with justification. We have analyzed your portfolio to calculate last year’s return in comparison to the market and used three different states of the world to calculate the expected return.

Based on the above states of the world and the volatility of your portfolio which is build up of 40% on MCHI, 20% on VETY.AS, 35% on IUKP.MI and 5% in PBW. We have calculated an expected return of -2,11%, with a volatility of 3.7%. Please note that in all three states of the world the expected return is negative.

For portfolio’s, we always look at the covariance between assets which is shown in the table below.

Please note that with the exception of the PBW fund all securities have similar volatility for one and five year, so the calculation above is therefore based on one year. For the Risk Free rate, we decided to use the 10 Year US government bond.