Tracking my investments

I've written about the recent re-allocation of my retirement investments, and the subsequent performance of the new investments versus the old stock-only portfolio I used to have. As of today, my current portfolio (consisting of index funds and a few shares of my company stock) is up 2.4% over where I "bought in", whereas my "old" portfolio is down 2.7% over the same time period. This represents a net gain of just over $2,000 due to the re-allocation. That's a nice little gain.

I thought I'd take a moment to go over how I track this performance. Basically, I use the "portfolios" tool provided by my brokerage's web interface. This is a web form that allows you to create up to five theoretical investment portfolios so that you can track their performance over time. You enter the symbol, number of units, and purchase price for each security, and the display will then show you the current dollar value of the portfolio, as well as the percentage gain or loss relative to the purchase price you entered.

I have the following five portfolios set up:

1. Current portfolio vs. purchase price - Here I list each holding in my current portfolio, and the actual price I paid for that holding. This shows how well my investments have done since I bought them.


2. Current portfolio vs. dollars invested - Here I again list each holding in my current portfolio, but I take into account the employer match I receive for contributing to our Employee Savings Plan. By taking the match into account, I essentially reduce the purchase price of every holding in my portfolio, so the gain/loss I'm seeing represents the return on actual dollars invested. Note that the total value of this portfolio is exactly the same as portfolio #1, but the gain/loss is different.


3. Old portfolio vs. purchase price - This is similar to portfolio #1, except that the holdings included are the stocks that I had before I re-allocated. This shows me how my "old" investments have done since I bought them.


4. Old portfolio vs. dollars invested - Similar to portfolio #2, but with the pre-allocation stock holdings. This shows me my return on actual dollars invested for my old stock holdings. Note that the total value of this portfolio is exactly the same as portfolio #3, but the gain/loss is different.


5. What could have been - For every time I've sold stock, I include the number of shares and the price at the time I sold the shares. This shows me whether the stocks have gone up or down since I sold.

These five portfolios give me all the information I really need at the moment. At any moment, I can check to see whether I'm doing better or worse since re-allocating. The last portfolio isn't particularly useful, but it's interesting to look back and see whether each sale I've made was a good deal.

Google Finance provides a similar portfolio tracking tool, and I'm sure most online brokers also provide this functionality.