How TipRanks Measures User Performance

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There are two ways that TipRanks measures the performance of your Smart Portfolio.

Validated Performance (Recorded by TipRanks)

Validated performance is an objective measure of your portfolio activity. It is also the system we use to rank individual investors.

It is based on the objective performance of the stocks you add to, or remove from, your portfolio. We measure performance using the end-of-day price (EOD) for the stocks you have traded on the day your transaction was recorded. If a transaction is entered after the stock market has closed, Smart Portfolio will measure the EOD price of the stock on the following day.

Validated performance does not incorporate the number of shares you add, rather it measures all transactions on an equal weight basis. This means that you can see your validated performance even if you haven’t specified the number of shares. As validated performance is based on EOD prices, it can take time to update.

Reported Performance (Reported by User)

Reported performance is a subjective measure of your portfolio activity and is based on values you edit in your portfolio, specifically purchase price. This feature enables you to see how your portfolio performs according to how you manage it day-to-day, which is why you have the flexibility to edit the transaction date & execution price. As the reported performance cannot be validated by TipRanks, it is not used for ranking investors.

To see your reported performance, you must enter the number of shares of your holdings.

How Your Performance is Ranked

When you look at your validated performance on Smart Portfolio, you will see your star-ranking and how you place compared to approximately half a million investors with a Smart Portfolio.

Your performance is based on your validated activity and incorporates 3 factors:

  • Average return – the average return of each of your recorded transactions
  • Success rate – the percentage of your transactions that have yielded a positive return
  • Statistical significance – the higher the number of transactions, the more statistically significant your performance. Therefore, an investor with many transactions is more likely to have a high star-ranking if they have a good average return and success rate. On the other hand, an investor with many transactions and a poor average return and success rate is likely to have a low star-ranking.