Navigating reporting and taxation can be daunting due to the numerous definitions and calculations involved. Below you can find a summary of key terms and definitions related to reporting and taxation:
What is Account Value?
- The Cash on the account that includes Cash balance and Transaction not booked
- Plus the market value of any Stocks, Bonds, Options, ETFs and other funds.
- Plus or minus the value of any unrealized profits or losses from open margin positions (CFDs, FX and Futures) on the account
- Cost to close, such as commission, exchange fees, stamp duty etc.
- The Total accruals which includes the financing accruals and corporate actions accruals
Read more about account value here
What is Net Free Equity?
- The value-dated cash balance of your main trading account, plus or minus cash balances on your sub-accounts in the same currency
- Plus or minus any unrealized profits or losses from open CFDs, FX Forwards, and Futures on your main trading account and sub-accounts in the same currency
- Plus the market value of any FX Options on your main trading account and sub-accounts in the same currency
- Minus any margin required for financing open positions on your main trading account and sub-accounts regardless of sub-account currency
Read more about Net Free Equity here
What are the withholding taxes for dividends?
Learn all you need to know about withholding taxes for dividends here
What is Absolute Exposure?
The absolute exposure is the amount currently invested in a particular position and represents the amount that an investor could potentially lose on that investment. Absolute exposure is, therefore, the risk that a position carries in an Account.
Learn more about Absolute Exposure here
What are cash and security transfers?
The net value of cash and security transfers are calculated for a given investment period, and include:
- Cash transfers between Accounts: If a cash transfer requires a currency exchange, e.g. transfer of cash from a USD Account to a EUR Account, Saxo applies the closing USD/EUR currency price on the day of transfer
- Security transfers between Accounts: A security is transferred at its market closing price on the day of the transfer
What are Cash Balance Currency Movements?
The cash balance currency movements include:
- Changes in the rate of exchange between client currency (DKK in this example) and the cash holding currency (EUR in this example)
- Adjustments associated with currency movements
Learn more about Cash Balance Currency Movements here
What are the Total Cash Movements?
The Total Cash Movements are the sum of cash movements within a given investment period, excluding cash balance currency movements.
Read more information on Total Cash Movements here
What is the time-weighted rate of return?
Learn about the time-weighted rate of return and how it's calculated here
What is the Value of Positions on my Account?
The composition of an Account or aggregated accounts can be broken down, to assess the risk each individual Position carries in the Account. This is done by determining the Position Value of each position in the Account – the absolute exposure.
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What is the Cost Summary?
You can find a summary of all costs in the Cost summary section of the Portfolio report and the Annual cost report. In the Portfolio report ‘External product cost’ are the expected indirect costs of instruments, whereas in the Annual cost report, it is indirect costs that have materialized for instruments.
Read more about the Cost Summary here
What are Aggregated Amounts?
An aggregated amounts can be a:
- Booked amount - These values affect the cash balance e.g. share amount, commission
- Constructed Amount - These amounts are calculated based on a range of other amounts or values e.g. P/L, markup
Read more about Aggregates Amounts here
What is the Sortino Ratio?
The Sortino ratio measures the excess returns earned per unit of downside risk (negative returns within the investment period). The excess returns are the difference between realised returns earned on the Account, and a risk-free rate (best risk-free alternative to investing such as holding cash).
Read more about the Sortino Ratio and how it is calculated here
What is the Sharpe Ratio?
The Sharpe ratio measures the returns on an Account, in comparison to the risk taken to achieve those returns.
Read more about the Sharpe Ratio and how it is calculated here
What is the Standard Deviation?
Standard deviation is the measure of investment risk and return, and the amount by which returns deviate from the average return observed within the investment period.
Read more about the Standard Deviation, Arithmetic Mean, Variance and how to calculate them here
What is max. Drawdown?
Maximum drawdown can be used to assess Account returns relative to a benchmark index, as a means to identify strategies that show steady outperformance over time.
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What are Winning Percentage Trades?
The winning percentage trades take into account for a given investment period, the number of trades with a positive Realised P/L within the investment period e.g Last year. A positive realised P/L means that positions were closed (sold) at a higher price than the price at which the position was opened (bought).
Learn more here
What are Winning Percentage Days?
The winning percentage days indicate, the number of profitable days (where a positive percentage daily return was observed) within an investment period, as a percentage of the total number of trading days in the investment period.
Read more here