portfolio guide stock market

2013. Accord Capital Equities Corp. Philstocks.ph. All rights reserved.

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The Portfolio refers to the group of stocks that you - as an investor - hold directly. In

essence, prudence suggests that you should construct an investment portfolio in accordance to

your risk tolerance and investment objectives. Assessing your risk tolerance and investment

objectives requires an understanding of your portfolio. Hence, it is necessary for you to

thoroughly review your portfolio in order to check whether youve met your investment

objectives and stop loss when you cant tolerate the risks.

To check your Portfolio, click the Portfolio icon in your console.

Figure 1. The Philstocks.ph Advance Console


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I. Definition of Terms

To understand better your portfolio, lets first define the terms and formulas found in your

portfolio.

Term Definition Formula

Position This is the number of shares that

you currently have for a

particular stock.

-

Average

Cost

This refers to the average price

per share (inclusive of

commission and charges) of the

stocks that you bought.

Average Cost =

[(Original Volume x Acquisition Price) +

Charges] Original Volume

Acquisition

Price

This refers to the price to which

you bought the stock.

-

Original

Volume

This refers to the initial position

you bought for the stock.

-

Charges This refers to the cost of the

commission and other

government-mandated fees

incurred for each of your

transaction.

Charges = Commission + VAT on

Commission + Sales Tax+ PCD Ad Valorem +

SCCP

Acquisition

Cost

This refers to the total cost of

purchasing a particular stock at

a given volume.

Acquisition Cost = Position x Average Cost

Market

Price

the current price of the stock -

Net Market

Value

This refers to the peso value of

the stock should you sell it at

the current market price.

Net Market Value = (Position x Market

Price) Charges

Gain/Loss This is the amount to which

your stocks have grown (or

declined) relative to its net

market value.

Gain/Loss = Net Market Value Acquisition

Cost

Gain: Net Market Value > Acquisition Cost

Loss: Net Market Value < Acquisition Cost

Gain/Loss

(%)

This is the percentage (%)

growth/decline of your stocks.

Gain/Loss (%) = [(Net Market Value

Acquisition Cost) Acquisition Cost] x 100

There are two types of portfolio available in your Philstocks.ph account: the Basic

Portfolio and the Advance Portfolio.


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A. Basic Portfolio

For newly activated clients, this will be the default portfolio that is displayed in the

console when you click the Portfolio icon. This portfolio contains the position, average cost,

acquisition cost, market price, net market value and gain/loss (%) for a particular stock.

Figure 2. The Basic Portfolio

To understand your portfolio, lets first define each column. (Disclaimer: The stocks seen in

the above figure is for illustration purposes only. Under no circumstances is it to be considered

as an offer to sell or a solicitation to buy any of the above stocks).

Important Note: Each stock and its corresponding information are presented horizontally.

(1) Symbol this column contains the stock code of the companies that you currently have.


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(2) Position the number of shares that you currently have for a particular stock. In the figure

below, the investor has 10 shares of BDO, 5,000 shares of SMDC and 7,000 shares of STI.

(3) Average Cost this refers to the average price per share (inclusive of commission and

other government-mandated charges) of the stocks that you bought. The figures are

usually rounded up to the fourth decimal place.

To compute for Average Cost, let us get the original volume, acquisition price and

charges on each of your stock which can be found in the History Tab of your Portfolio:

The Acquisition Price refers to the price to which you bought the stock. The Original

Volume refers to the initial position you bought for the stock. The Charges refer to the cost of

the commission and other government-mandated fees incurred for each of your transaction.


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From the data above, we can compute for the Average Cost of STI Shares using the formula:

Average Cost = (Original Volume x Acquisition Price) + Charges

Original Volume

Given Particulars:

a. On February 18, 2013, you bought 5,000 shares of STI @ Php 1.00 per share; such

purchase would incur an aggregate charge (commission rate and other government-

mandated fees) of Php 24.01, for a total acquisition cost of Php 5,024.01.

b. On February 20, 2013, you bought 2,000 shares of STI @ Php 1.01 per share; such

purchase would incur an aggregate charge (commission rate and other government-

mandated fees) of Php 23.05, for a total acquisition cost of Php 2,043.05.

Transaction

Date

Original

Volume

Acquisition

Price (per

share)

Gross

(Original Volume

x Acquisition

Price)

Charges

(Commission Rate and

other government-

mandated fees

Net

(Gross +

Charges)

02/18/2013 5,000 1.00 5,000 24.01 5,024.01

02/20/2013 2,000 1.01 2,020 23.05 2,043.05

TOTAL 7,000 7,067.06


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The Total Average Cost for the 7,000 STI shares would be:

Total Average Cost = Total Net

Total Original Volume

= 7,067.06

7,000

= 1.00958 1.0096

(4) Acquisition Cost this refers to the total cost of purchasing a particular stock at a given

volume. It is the product of the number of shares that you currently own (Position) and its

average cost (Avg Cost).

To illustrate:

If you have 10 shares of BDO stock @ an average cost of 87.9676, your acquisition cost

is:

Acquisition Cost (BDO) = Position x Avg Cost

= 10 x 87.9676

= 879.676 879.68

The total Acquisition Cost is the sum total of all acquisition costs of all your stocks.

Total Acquisition Cost = Acquisition Cost (BDO) + Acquisition Cost (SMDC)

+ Acquisition Cost (STI)

= 879.68 + 50,156.09 + 7,067 .06

= 58,102.82


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(5) Market Price this is the current price of the stock.

(6) Net Market Value this refers to the peso value of the stock at the current market price.

This is the product of the number of shares that you have (Position) and the current price

(Market Price) minus the Commission and other government-mandated fees.

To compute for the commission and other government mandated fees, add the following:

a. Commission = 0.25% or 20Php, which ever is higher

b. 12% VAT on Commission

c. Sales Tax* = Gross Amount x 0.005

(Note: Gross Amount = Position x Market Price)

d. Philippine Central Depository (PCD) Ad Valorem Fees (PSE Fee, Clearing and Trade

Guaranty Fund, Securities Investors Protection Fund) = Gross Amount x 0.0003017

e. Securities Clearing Corp. of the Philippines = Gross Amount x 0.000009174

*The sales tax is only applicable for every selling transaction.

To get the net market value of BDO, let us first compute its commission and other

government-mandated fees:

Commission 0.0025 or Php 20 which ever is higher 20.00

12% VAT on Commission 20.00 x 0.12 2.4

Sales Tax 915.50 x 0.005 4.5775

PCD/Other Fee 915.50 x 0.0003017 0.27620635

SCCP 915.50 x 0.000009174 0.008398797

TOTAL 27.262105147


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To compute for the Net Market Value:

Net Market Value = (Position x Market Price) Commission and other mandated fees

= (10 x 91.5500) - 27.262105147

= 915.50 - 27.262105147

= 888.23

The Total Net Market Value is the sum total of all the net market values of your stock.

Total = Net Market Value (BDO) + Net Market Value (SMDC) + Net Market Value (STI)

= 888.23 + 43,890.61 + 7,079.60

= 51,858.44

(7) Gain/Loss this is the amount to which your stocks have grown (or declined) relative to

its net market value. The difference between the Net Market Value and Acquisition

Cost of your stock is the net Gain/Loss. When the Net Market Value is greater than

your Acquisition Cost, there is a Gain in your stock. On the other hand, when the Net

Market Value is lesser than the Acquisition Cost, there is a Loss. Note however that

these Gains/Losses are Paper Gains/Losses only if you sell your stocks at its current

market price can you experience the actual gain/loss.

To compute the Gain or Loss of STI, lets use the formula:

Gain/ Loss = Net Market Value Acquisition Cost

= 7,079.60 7,067.06

= 12.54

(8) Gain/Loss (%) = is the percentage (%) growth/decline of your stocks. It is equal to the

[Net Market Value Acquisition Cost] divided by Acquisition Cost


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To compute for the %Gain/Loss of STI, use the formula

%Gain/Loss = [(Net Market Value Acquisition Cost) Acquisition Cost] x 100

= [(7,079.60 7,067.06) 7,067.06] x 100

= (12.54 7,067.06) x 100

= 0.00177 x 100

= 0.177 0.18%

To switch to advance portfolio, just hover the mouse to the Portfolio Tab, and click the Switch

to Advance Button.

B. Advance Portfolio

To get a more comprehensive perspective of your portfolio, you may refer to Advance

Portfolio. It provides a more detailed summary of your portfolio.

To view the breakdown of your purchases per stock, just click the [+] button located

beside the stock symbol.


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Figure 3. Advance Portfolio

If you would notice, there is a breakdown of your transactions per stock. This makes it

easy for you to verify your transactions and see the gains/loss of your equities at the current

market price. In this way, you can manage your risk by easily tracking and monitoring your stock

positions real-time.

Aside from the data found in your basic portfolio, the Advance Portfolio provides a

breakdown of the original volume and date of all your purchase transactions for a particular

stock.

STI Breakdown


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In the figure above, you can see that there are 2 purchase dates for STI: February 18,

2013 and February 20, 2013. This means that on February 18, 2013, you purchased 5,000 share

of STI at an average cost of 1.0048. On February 20, 2013, you purchased an additional 2,000

shares of STI at an average cost of 1.0215. This shows that you bought STI shares at a lower

price on Feb. 18 than on Feb. 20. In this case, you may opt to sell partially ONLY the initial

5,000 STI shares youve purchased last Feb. 18 because this gives you a gain of 0.53% than to

totally sell ALL your shares which will only give you a 0.18% gain.

The Advance Portfolio has an additional column incorporating the Original Volume. The

Original Volume refers to the initial volume to which you purchase a particular stock at a given

price at a given date. In short, this is the number of shares that you have initially bought before

making another transaction.

Take for example the case of your SMDC stock. You currently have 5,000 shares of

SMDC (Position), but what you originally bought was 7,000 SMDC shares on February 20,

2013.

While the Original Volume is static, the Position is dynamic. The Position changes

when you sell partially some of your shares.


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Suppose that on Feb. 18, 2013, you bought 5,000 shares of STI (Original Volume) with

an average cost of 1.0048. Since you noticed that at the current market price (1.0200) you will

have a +0.53% gain, you decided to sell a portion of it, say, 1,000 STI shares. Once you sell

these 1,000 STI shares, your position, acquisition cost, net market value, and gain/loss (%)

automatically change.

[-] STI 6,000 1.0104 6,062.20 1.0200 6,065.098 +2.898 +0.05

02/18/2013 5,000 4,000 1.0048 4,019.20 1.0200 4,035.93 +16.73 +0.42

02/20/2013 2,000 2,000 1.0215 2,043.00 1.0200 2,006.74 -36.26 -1.77

Notice that your position now becomes 4,000 (compared to the original position of 5,000

shares) because you have sold a thousand STI shares.

Now, lets compute for the average cost of STI.

To compute for Average Cost, let us get the original volume, acquisition price and

charges on each of your stock which can be found in the History Tab of your Portfolio:


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From the above data, we can compute for the Average Cost of STI Shares using the formula:


Original Volume

Transaction Date Original Volume Acquisition Price Charges

02/18/2013 5,000 1.00 24.01

02/20/2013 2,000 1.01 23.05

To compute for the Average Cost of each transaction, we use the following formula:


Original Volume


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1. Avg Cost (02/18/2013) = (5,000 x 1.00) + 24.01

5,000

= 5,024.01

5,000

= 1.0048

2. Avg Cost (02/20/2013) = (2,000 x 1.01) + 23.05

2,000

= 2,043.05

2,000

= 1.021525

The Total Average Cost for the 7,000 STI shares would be:

Total Avg Cost = [(Orig Vol * Acquisition Price) + Charges](02/18/2013) + [(OrigVol * Acquisition Price) + Charges](02/20/2013)

Orig Vol 02/18/2013 + Orig Vol 02/20/2013

= 5,024.01 + 2,043.05

5,000 + 2,000

= 7,067.06

7,000

= 1.00958 1.0096

Note: Selling transactions do not affect the average cost.

Given the average cost, we can now compute for the Acquisition Cost of STI shares per

transaction date. We use the formula:

Acquisition Cost = Position x Average Cost


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1. Acquisition Cost (02/18/2013) = 5,000 x 1.0048

= 5,024.00

2. Acquisition Cost (02/18/2013) = 2,000 x 1.0215

= 2,043.00

3. Total Acquisition Cost (STI) = 7,000 x 1.0096

= 7,067.06

Should you sell your positions at the current market price, your resulting Net Market

Value would be equal to the product of the number of shares that you have (Position) and the

current price (Market Price) minus the Commission and other government-mandated fees.

If you compute for the Net Market Values of your STI shares per transaction dates, the

formula to be used is:

Net Market Value = (Position x Market Price) Commission and other mandated fees


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Transaction

Date

Position Market

Price

Charges (Commission + VAT on Commission +

Sales Tax+ PCD Ad Valorem + SCCP)

02/18/2013 5,000 1.02 49.54

02/20/2013 2,000 1.02 33.26

TOTAL 7,000 1.02 60.40

1. Net Market Value (02/18/2013) = (5,000 x 1.02) 49.54

= 5,100.00 49.54

= 5,050.46

2. Net Market Value (02/20/2013) = (2,000 x 1.02) 33.26

= 2,040.00 33.26

= 2,006.74

3. Net Market Value (STI) = (7,000 x 1.02) 60.40

= 7,140.00 60.40

= 7,079.60

Please note that the aggregate net market value of each stock is NOT always the same to

the sum of all the net market values of its breakdown. The difference lies in the commission and

other government-mandated fees (charge) incurred in each of your transactions. That is, the

charge is smaller in the aggregate net market value (60.40) compared to the sum of all the

charges found in your breakdown (49.54 + 33.26 = 82.8).

You can now compute for your Gain/Loss using the formula:

Gain/ Loss = Net Market Value Acquisition Cost


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1. Gain/ Loss (02/18/2013) = Net Market Value Acquisition Cost

= 5,050.46 5,024.00

= +26.46


= 2,006.74 2,043.00

= -36.36


= 7,079.60 7,067.06

= +12.54

To compute for the Gain/Loss (%), you use the formula:

%Gain/Loss = [(Net Market Value Acquisition Cost) Acquisition Cost] x 100

1. %Gain/Loss (02/18/2013) = [(Net Market Value Acquisition Cost)

Acquisition Cost] x 100

= [(5,050.46 5,024.00) 5,024.00] x 100

= +0.53 %



= [(2,006.74 2,043.00) 2,043.00] x 100

= -1.77 %



= [(7,079.60 7,067.06) 7,067.06] x 100

= +0.18 %

For the Total Overview of your Portfolio:


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- The total Acquisition Cost is the sum total of all the total acquisition costs of each stock.

Total = Acquisition Cost (BDO) + Acquisition Cost (SMDC) + Acquisition Cost (STI)

= 879.68 + 50,156.09 + 7,067 .06

= 58,102.82

- The Total Net Market Value is the sum total of all the total net market values of each

stock.

Total = Net Market Value (BDO) + Net Market Value (SMDC) + Net Market Value (STI)

= 888.23 + 43,890.61 + 7,079.60

= 51,858.44

- The Gain/Loss is the difference of the Total Net Market Value and Total Acquisition

Cost.

Gain/ Loss = Total Net Market Value Total Acquisition Cost

= 51,858.45 58,102.82

= - 6,244.37

- The Gain/Loss (%) is the quotient of Gain/Loss over the Acquisition Cost multiplied by

100%.

Gain/Loss (%) = (Total Net Market Value Total Acquisition Cost) x 100

Acquisition Cost

= 51,858.45 58,102.82 x 100

58,102.82

= - 6,244.37 x 100

58,102.82

= -0.10747 x 100

= -10.747 -10.75%

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