Tracking Performance
Tracking Your Portfolio Performance
What gets measured gets managed. Tracking your portfolio performance helps you understand whether your investment strategy is working and where adjustments might be needed.
Measuring Returns
There are several ways to measure portfolio returns:
- Absolute return — The total percentage gain or loss on your portfolio. If you invested KES 100,000 and it is now worth KES 120,000, your absolute return is 20%.
- Annualised return — Your return expressed as a yearly rate. A 20% return over 2 years is approximately 9.5% annualised, which is more useful for comparison.
- Total return — Includes both price appreciation and dividends received. Always measure total return, as dividends are a significant part of NSE investing returns.
Benchmarking Against NASI
The NSE All Share Index (NASI) is the most appropriate benchmark for a portfolio of NSE stocks. Comparing your performance to NASI tells you whether your stock-picking is adding value or whether you would be better off investing in the entire market.
- Your portfolio returned 18%, NASI returned 12% — You outperformed the market by 6 percentage points. Your stock selection is adding value.
- Your portfolio returned 8%, NASI returned 15% — You underperformed. It is worth reviewing your holdings and strategy.
Do not panic if you underperform in any single year. Judge your performance over 3-5 year periods to get a meaningful picture.
Using Stockr to Track Performance
Stockr provides a portfolio tracker that makes performance monitoring easy:
- Add your holdings — Enter the stocks you own, quantities, and purchase prices
- Track daily changes — See how your portfolio moves each trading day
- View allocation — Visual breakdown of your portfolio by stock and sector
- Monitor dividends — Track upcoming and received dividend payments
- Compare to NASI — See how your portfolio stacks up against the market benchmark
Review your portfolio weekly to stay informed, but avoid checking multiple times per day. Frequent monitoring can lead to anxiety and impulsive decisions. Investing is a long-term game, and the best results come from patience and discipline.
Congratulations! You have completed the Portfolio Building track. You now have the knowledge to build, manage, and grow a diversified portfolio on the NSE. Put what you have learned into practice and start your investing journey today.