The market value on the performance reports you receive from your investment manager frequently differs from the market value on the statements you receive from your broker. Typically, the value on the performance report is more accurate.
Here’s what you need to know to understand why the numbers may not match.
- Some mutual funds distribute dividends late — meaning dividends earned in the previous month get processed after the month has ended with a trade date in the previous month. The market value on performance reports typically includes these late dividends. Brokerage statements usually do not.
- The actual ending value has changed since the statement was printed. For instance, if a trade error, a corrected dividend or a refunded fee crosses the end of the month, the statement will not reflect the change, but performance report will.
- The number of decimal places used in prices may vary. Most statements use 2 digits after the decimal on their statements while portfolio management software often takes the prices out to 4 digits after the decimal.
- Portfolio management software calculates the ending value based on the trade date while some statements calculate the value based on the settlement date. If a trade crosses the end of a month, the brokerage statement will omit it, while your performance report will include it.
- A few statements use the prices from the last Friday of the month to calculate their ending value. Performance reports typically use prices from the last business day of the month.
- A few statements round their share quantities to the nearest whole number even though fractional shares are held in the account. Performance reports usually do not round share quantities.