Purpose
UVS is a time weighted performance metric that is used by investment clubs to apportion ownership between investment club members. It enables club members to make flexible monthly contributions (subscriptions) and withdrawals through the process of purchasing and cancelling units. As a performance metric the unit valuation system strength lies in the ability to apportion ownership at any point in time, as club members buy and sell units through making subscriptions and withdrawals. It is an effective means of reflecting changes between day to day investment performance, however it should not be used as a metric for comparing investment performance between for example two Investment Clubs.
When comparing performance money-weighted metrics, it is recommended that you use Internal Rate of Return calculations.
Read more about this topic: Unit Valuation System
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