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
Famous quotes containing the word purpose:
“A material resurrection seems strange and even absurd except for purposes of punishment, and all punishment which is to revenge rather than correct must be morally wrong, and when the World is at an end, what moral or warning purpose can eternal tortures answer?”
—George Gordon Noel Byron (1788–1824)
“And is the price for your acceptance for me to conform? To be as you would want me to be?... You must accept me as I am. Do not question.... If my behavior seems different perhaps it is because it serves a higher purpose than to find acceptance in this dull and useless world.”
—Pat Fielder, and Paul Landres. Dracula (Francis Lederer)
“I have sought his aid—but if after endeavoring to do my best in the light which he affords me, I find my efforts fail, I must believe that for some purpose unknown to me, He wills it otherwise.”
—Abraham Lincoln (1809–1865)