Thursday, October 06, 2011

Moominvalley Report September 2011

Another month of negative returns. Seven straight months of losses. Returns in USD terms were heavily affected by the rise in the US Dollar which reduced the value of all our non-USD investments. As a result net worth fell by $US56k:

In Australian Dollar terms the loss was "only" $A11k. The USD rate of return was -13.26% compared with the MSCI World Index's loss of 9.4%. In AUD terms we lost 4.38% and in currency neutral terms 6.07%. Expenditure was high. We went to the US and bought a lot of stuff there - clothes, kitchen stuff, a new camera etc. Our first trip back since we left in 2007. I don't really feel like writing a lot more about this.

In response to the comment from Financial Independence, I've introduced a new format for these monthly income/expenditure statements. Hopefully, they give more intuition about how the numbers are calculated.


Financial Independence said...

Hi there,

This is somewhat confusing, as some figures are with minuses and some are not, but both contributing towards negativity...

Little narrative would definitely help!

In negligence is a wonderful thing? So many people do not care about finance and live happy life. The other do care, but all end up in the same boat...

mOOm said...

Sorry, I get tired of explaining it every month. Maybe I should write a post explaining that I can refer to or think of a better format.

Other income and investment income add up to total income. The investment income is then broken down into two categories marked in italics to show the effect of foreign currency movements. Total income minus expenditure and tax credits results in the change in the net worth. Core expenditure takes out any exceptional expenditures - mostly those that will be refunded at some point. Everything is also broken down into retirement and current or non-retirement accounts.

Financial Independence said...

Thanks a lot for your explanation and time : -)