Profit & Loss Analysis

1. Profit and Loss Analysis

Profit and Loss Analysis consists of three modules:

1. My Earnings

2. P&L Calendar

3. Profit and Loss Distribution.

Currency switching and filtering options are available for clients to analyse their profit and loss in different scenarios and categories. When selecting different filtering criteria, the display of each module on the page will also change accordingly.

2. Daily Cut-Off Time For Profit and Loss Calculation

Profit and loss calculation is based on the daily cut-off time at 08:00 MYT (09:00 MYT during Daylight Saving Time). For example, the profit and loss between 20:00 on T-1 day and 08:00 on T day is considered as the profit and loss for T day.

3. My Earnings

My Earnings consists of profit and loss information and trend charts. The profit and loss information will be displayed based on the client's filtering conditions. User can choose to display trend chart in terms of Yield, P&L or Net Account Value.

3.1 Trend Chart Explanation

The information displayed in the trend chart is linked to the client's filtering conditions. It supports the display of three data trends: Yield, P&L or Net Account Value. The x-axis of the trend chart represents time, while the y-axis represents the corresponding data for the selected type of trend chart.

(1) Yield Trend: The x-axis represents time, and the y-axis represents the Yield. Clients can select a time period and the trend chart will display the cumulative yield during the same period. On the left side of the trend chart, clients can select different market indices for comparison.

(2) Profit and Loss Trend: The x-axis represents time, and the y-axis represents the cumulative profit and loss amount. Clients can select a time period and the trend chart will display the profit and loss amount during the same period.

(3) Net Account Value Trend: The x-axis represents time, and the y-axis represents the net asset value. Clients can select a time period and the trend chart will display the net account value during the same period. If there is a non-trading day, it will be equal to the net asset value of the previous trading day.

4. Yield Calculation Formula

Webull provides three different methods for calculating the yield, which are explained below.

4.1 Simple-Weighted Yield

The simple-weighted yield is calculated as the cumulative return over a period divided by the initial net assets plus the net inflow during the period. The cumulative return is calculated as the ending net assets minus the initial net assets minus the net inflow during the period.

The simple-weighted yield takes into account the net inflow of funds and stocks, but both are considered to occur at the beginning of the period. When there are more significant inflows and outflows of funds, it may result in an underestimation of positive returns and an overestimation of negative returns, making it less accurate.

4.2 Time-Weighted Yield

The time-weighted yield is calculated as [(1+R1)*(1+R2) … *(1+Rn)-1]*100%, where R is the daily return divided by the initial net assets plus the daily net inflow. The daily return is calculated as the ending net assets minus the starting net assets minus the daily net inflow.

The time-weighted yield considers the time value of money and can be understood as the compound return earned on an initial investment of 1 unit until the end of the period. It calculates the cumulative return from the beginning to the end by calculating the daily return. This method helps to mitigate the impact of cash flow changes on returns to a certain extent. However, this method treats the daily returns equally without considering the investment amount weights, which may result in calculating positive returns even when the user incurs losses, leading to a possible inconsistency between the sign of the return and the period return.

4.3 Cash-Weighted Yield

The cash-weighted yield is calculated as the cumulative return over a period divided by the adjusted initial net assets. The cumulative return is calculated as the ending net assets minus the initial net assets minus the net inflow during the period. The adjusted initial net assets are calculated by adding the weighted daily net inflows to the initial net assets.

The weight of the daily net inflow is calculated as the number of days the cash flow remains in the period divided by the total number of days in the period. For example, if the calculation period is 100 days and there is a cash inflow of 200 units on the 20th day, the weight of that day's cash inflow would be (100-20)/100 = 0.8, which means that the 200 units would be considered as 160 units that remained throughout the entire calculation period.

The cash-weighted yield considers the net inflow of funds and stocks and takes into account the impact of different position weights during different time periods. It can calculate both positive and negative returns accurately, allowing for negative returns during loss periods and positive returns during profitable periods.

For example,

The results calculated based on the three types of return calculation methods are as follows:

Simple Weighted Yield = [(50-150)/(100+1000)]*100% = -9.09%

Time Weighted Yield = [(1+50%)*(1-13.04%)-1]*100% = 30.44%

Cash Weighted Yield = (50-150)/[100 +(2 -2)/2] = -100%

5. Net Inflow Amount

Net Inflow Amount = Deposits - Withdrawals + Incoming Fund Transfers - Outgoing Fund Transfers + Incoming Stock Transfers - Outgoing Stock Transfers + Incoming Currency Exchanges - Outgoing Currency Exchanges - Others

Thus, the net inflow amount comprises fund deposits/withdrawals, stock transfers, currency exchanges, and other transactions.

Fund Deposit/Withdrawal: Refers to the deposit and withdrawal of funds.

Stock Transfers: If completed during trading hours, the previous day's closing price is used to calculate the net inflow amount. If completed after trading hours, the closing price of the current day is used.

Currency Exchanges: Includes incoming and outgoing currency exchanges and the difference between currency exchanges is included in the net inflow amount.

Others: Includes gifted stocks. If credited during trading hours, the previous day's closing price is used to calculate the net inflow amount. If credited after trading hours, the closing price of the current day is used.

6. Other common questions

6.1 Is the data on the asset analysis page updated in real time?

The data on my earnings and losses calendar module is updated in real time. You can manually refresh to get the latest data. The profit and loss distribution module is updated daily at at 08:00 SGT (09:00 SGT during Daylight Saving Time).

6.2 Why is the profit for the current day different between the profit and loss calendar and the asset page?

The discrepancy between the profit for the current day in the profit and loss calendar and the asset page is mainly due to the fact that the profit for the current day on the asset page includes other relevant fees incurred during the trading process.