Title 17: Commodity and Securities Exchanges
PART 275—RULES AND REGULATIONS, INVESTMENT ADVISERS ACT OF 1940
Browse Previous |
Browse Next
§ 275.205-1 Definition of “investment performance” of an investment company and “investment record” of an appropriate index of securities prices.
(a) Investment performance of an investment company for any period shall mean the sum of:
(1) The change in its net asset value per share during such period;
(2) The value of its cash distributions per share accumulated to the end of such period; and
(3) The value of capital gains taxes per share paid or payable on undistributed realized long-term capital gains accumulated to the end of such period; expressed as a percentage of its net asset value per share at the beginning of such period. For this purpose, the value of distributions per share of realized capital gains, of dividends per share paid from investment income and of capital gains taxes per share paid or payable on undistributed realized long-term capital gains shall be treated as reinvested in shares of the investment company at the net asset value per share in effect at the close of business on the record date for the payment of such distributions and dividends and the date on which provision is made for such taxes, after giving effect to such distributions, dividends and taxes.
(b) Investment record of an appropriate index of securities prices for any period shall mean the sum of:
(1) The change in the level of the index during such period; and
(2) The value, computed consistently with the index, of cash distributions made by companies whose securities comprise the index accumulated to the end of such period; expressed as a percentage of the index level at the beginning of such period. For this purpose cash distributions on the securities which comprise the index shall be treated as reinvested in the index at least as frequently as the end of each calendar quarter following the payment of the dividend.
Exhibit I [Method of computing the investment record of the standard & poor's 500 stock composite index for calendar 1971]------------------------------------------------------------------------ Quarterly dividend yield- composite index ------------------------- Quarterly ending_ Index value Quarterly \1\ Annual percent \3\ percent \2\ (\1/4\ of annual)------------------------------------------------------------------------Dec. 1970........................ 92.15 ........... ...........Mar. 1971........................ 100.31 3.10 0.78June 1971........................ 99.70 3.11 .78Sept. 1971....................... 98.34 3.14 .79Dec. 1971........................ 102.09 3.01 .75------------------------------------------------------------------------\1\ Source: Standard & Poor's Trade and Securities Statistics, Jan. 1972, p. 33.\2\ Id. See Standard & Poor's Trade and Securities Statistics Security and Price Index Record_1970 Edition, p. 133 for explanation of quarterly dividend yield.\3\ Quarterly percentages have been founded to two decimal places.
|
Change in index value for 1971: 102.09–92.15=9.94.
Accumulated value of dividends for 1971:
Aggregate value of dividends paid, assuming quarterly reinvestment and computed consistently with the index:
(Percent yield as computed above) × (ending index value)=Aggregate value of dividends paid
For 1971:
.0314×102.09=3.21
Investment record of Standard & Poor's 500 stock composite index assuming quarterly reinvestment dividends:
The same method can be extended to cases where an investment company's fiscal quarters do not coincide with the fiscal quarters of the S & P dividend record or to instances where a “rolling period” is used for performance comparisons as indicated by the following example of the calculation of the investment record of the Standard & Poor's 500 Stock Composite Index for the 12 months ended November 1971:
|
Index value Nov. 30, 1971..................................... 93.99Index value Nov. 30, 1970..................................... 87.20 --------- Change in index value........................................ 6.79
------------------------------------------------------------------------ Dividend yield Rate for -------------------- each month Quarter ending_ of quarter Annual \1/4\ of (\1/12\ of rate annual annual)------------------------------------------------------------------------Dec. 1970............................... 3.41 0.85 0.28Mar. 1971............................... 3.10 .78 .26June 1971............................... 3.11 .78 .26Sept. 1971.............................. 3.14 .79 .26Dec. 1971............................... 3.01 .75 .25------------------------------------------------------------------------
|
Accumulated value of dividends reinvested:
December=1.0028
January-March=1.0078
April-June=1.0078
July-September=1.0079
October-November=1.00534
4 The rate for October and November would be two-thirds of the yield for the quarter ended Sept. 30 (i.e. .667×.79=5269) since the yield for the quarter ended Dec. 31 would not be available as of Nov. 30.
Dividend yield:
(1.0028×1.0078×1.0078×1.0079× 1.0053)−1.00=.0320
Aggregate value of dividends paid computed consistently with the index:
.0320×93.99=3.01
Investment record of the Standard & Poor's 500 Stock Composite Index for the 12 months ended November 30, 1971:
|
Exhibit II [Method of Computing the Investment Record of the New York Stock Exchange Composite Index for Calendar 1971]---------------------------------------------------------------------------------------------------------------- (3)_Aggregate (4)_Quarterly market value value of of shares estimated listed on the cash payments (5)_Estimated (1)_Quarter ending (2)_Index NYSE as of of shares yield \4\ value \1\ end of listed on the (quarterly quarter NYSE percent) (billions of (millions of dollars) \2\ dollars) \3\----------------------------------------------------------------------------------------------------------------Dec. 1970............................................. 50.23Mar. 1971............................................. 55.44 $709 $5,106 0.72June 1971............................................. 55.09 710 4,961 .70Sept. 1971............................................ 54.33 709 5,006 .71Dec. 1971............................................. 56.43 742 5,183 .70----------------------------------------------------------------------------------------------------------------\1\ Source: New York Stock Exchange Composite Index as reported daily by the New York Stock Exchange.\2\ Source: Monthly Review, New York Stock Exchange.\3\ Source: The Exchange, New York Stock Exchange magazine, May, Aug., Nov. 1971 and Feb. 1972 editions. Upon request the Statistics Division of the Research Department of the NYSE will make this figure available within 10 days of the end of each quarter.\4\ The ratio of column 4 to column 3.
|
Change in NYSE Composite Index value for 1971: 56.43−50.23=6.20.
Accumulated Value of Dividends of NYSE Composite Index for 1971:
Aggregate value of dividends paid on NYSE Composite Index assuming quarterly reinvestment:
For 1971:
.0286×56.43=1.61
Investment record of the New York Stock Exchange Composite Index assuming quarterly reinvestment of dividends:
The same method can be extended to cases where an investment company's fiscal quarters do not coincide with the fiscal quarters of the NYSE dividend record or to instances where a “rolling period” is used for performance comparisons as indicated by the following example of the calculation of the investment record of the NYSE Composite Index for the 12 months ended November 1971:
|
Index value 51.84 Nov. 30, 1971Index value 47.41 Nov. 30, 1970 -------------------------------------------------- Change in 4.43 index value
------------------------------------------------------------------------ Rate for Dividend each month Quarter ending yield of quarter quarterly (\1/12\ of percent annual)------------------------------------------------------------------------Dec. 1970....................................... 0.79 0.26Mar. 1971....................................... .72 .24June 1971....................................... .70 .23Sept. 1971...................................... .71 .24Dec. 1971....................................... .70 .23------------------------------------------------------------------------
|
Accumulated value of dividends reinvested:
December=1.0026
January-March=1.0072
April-June=1.0070
July-September=1.0071
October-November=1.00474
4 The rate for October and November would be two thirds of the yield for the quarter ended September 30 (i.e. .667×.71=4736), since the yield for the quarter ended December 31 would not be available as of November 30.
Dividend yield:
(1.0026×1.0072×1.0070×1.0071× 1.0047)−1.00=.0289
Aggregate value of dividends paid computed consistently with the index:
.0289×51.84=1.50
Investment record of the NYSE Composite Index for the 12 months ended November 30, 1971:
(Secs. 205, 211, 54 Stat. 852, 74 Stat. 887, 15 U.S.C. 80b–205, 80b–211; sec. 25, 84 Stat. 1432, 1433, Pub. L. 91–547)
[37 FR 17468, Aug. 29, 1972]
Browse Previous |
Browse Next
|
