1. Profit and Loss Analysis Profit and Loss Analysis consists of three modules: my earnings, profit and loss calendar, and profit and loss distribution. Webull also provides currency switching and filtering functions to meet users' needs for profit and loss analysis in different scenarios and categories. When users select different filtering criteria, the display of each module on the page will also change accordingly.
2. Daily Cut-off Concept The data for profit and loss analysis is calculated based on the daily cut-off point at 8:00 AM Hong Kong time for Eastern Standard Time (9:00 AM during Daylight Saving Time). For example, the profit and loss between 8:00 PM on T-1 day and 8:00 PM 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 user's filtering conditions, showing either the realized profit and loss amount or the cumulative profit and loss amount, as well as the rate of return and net assets.
3.1 Trend Chart Explanation The information displayed in the trend chart is related to the user's filtering conditions. In all modes, it supports the display of three data trends: rate of return, cumulative profit and loss amount, and net assets. 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) Rate of Return Trend: The x-axis represents time, and the y-axis represents the rate of return. The dots on the chart represent the cumulative rate of return from the account's initial date to the selected end date within the selected time frame. On the left side of the trend chart, you can select different market indices for comparing the rate of return within the same period.
(2) Cumulative Profit and Loss Amount Trend: The x-axis represents time, and the y-axis represents the cumulative profit and loss amount. The dots on the chart represent the cumulative profit and loss amount from the account's initial date to the selected end date within the selected time frame.
(3) Net Assets Trend: The x-axis represents time, and the y-axis represents the net asset value. The dots on the curve represent the net asset value of the account on that day. If it is not a trading day, it will be equal to the net asset value of the previous trading day.
4. Rate of Return Calculation Formula Webull provides three different methods for calculating the rate of return, which are explained below.
4.1 Simple Weighted Rate of Return
The simple weighted rate of return 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 rate of return 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 overestimation of negative returns, making it less accurate.
4.2 Time Weighted Rate of Return
The timeweighted rate of return 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 timeweighted rate of return 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 first 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 Rate of Return
The cashweighted rate of return 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 rate of return 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, | 