illio adjusts chosen benchmarks into the base currency of the portfolio so that users can compare performance as accurately as possible
Why is it done?
Currently, If a user holds investments in a currency different to their portfolio base currency, illio calculates a real time base currency value of these assets. When we calculate your asset’s base currency value based it positively or negatively impacts the performance of the portfolio. You end up with a more accurate view of performance that includes P&L due to Forex (FX) fluctuations.
To effectively analyse and compare portfolio performance to a benchmark, illio will also adjust that benchmark's value into your portfolio base currency.
Example below
- The first chart indicates the performance of a portfolio since inception with 1 US stock and US benchmark where the base currency of the portfolio is USD
- The second chart shows the performance of the portfolio since inception with 1 US stock and a US benchmark while the base currency is GBP. The performance of the stock and the benchmark are adjusted and represents any changes in the USD to GBP rate.
The benchmark and the stock are the same in both cases, but their value and thus performance within your portfolio is affected when they’re changed from their local currency to your base currency.
