What Is Ex-Post?

Ex-post is another word for 澳洲幸运5官方开奖结果体彩网:actual returns and is Latin for “after the fact.”

The use of 澳洲幸运5官方开奖结果体彩网:historical returns has customarily been the most well-known approach to forecast the probability of incurring a loss on 澳洲幸运5官方开奖结果体彩网:investment on any given day. Ex-post is the opposite of ex-ante, which means “before the event.”

Understanding Ex-Post

Ex-post information is attained by companies to forecast future earnings. Ex-post information is utilized in studies such as 澳洲幸运5官方开奖结果体彩网:value at risk (VaR), a probability study that approximates the maximum amount of loss that an investment portfolio may incur on any day. VaR is defined for a specified investment portfolio, probability, and 澳洲幸运5官方开奖结果体彩网:time horizon.

Ex-post yield differs from ex-ante yield because it represents actual values, essentially what investors earn rather than estimated values. Investors base their decisions on expected returns vs. actual returns, which is an important aspect of an investment’s 澳洲幸运5官方开奖结果体彩网:risk analysis. Ex-post is the current 澳洲幸运5官方开奖结果体彩网:market price, minus the price that the investor paid. I💛t shows the performance of an asset; however, it excludes projections and probabilities.

Calculating Ex-Post

Ex-post is calculated using the beginning and ending asset values for a specific period, any growth or decline in the asset value, plus any 澳洲幸运5官方开奖结果体彩网:earned income produced by the asset during the period. Analysts use ex-post data on investment price fluctuations, earnings, and other metrics to predict expected returns. It is measured against the 澳洲幸运5官方开奖结果体彩网:expected return to confirm the accuracy of 澳洲幸运5官方开奖结果体彩网:risk assessment methods.

Ex-post is best used for periods less than a year and measures the yield earned for an investment 澳洲幸运5官方开奖结果体彩网:year to date. For example, for a March 31 quarterly report, the actual return measures how much an investor’s 澳洲幸运5官方开奖结果体彩网:portfolio has increased in percentage from Jan. 1 to March 31. If ꦛthe number is 5%, then the portfolio 🌳gained 5% since Jan. 1.

Ex-Post Analysis

Ex-post performance 澳洲幸运5官方开奖结果体彩网:attribution analysis, or benchmark analysis, gauges the performance of an inꦇvestment🦄 portfolio based on the return of the portfolio and its correlation with numerous factors or benchmarks. Ex-post analysis is the traditional approach of performance analysis for long-only funds.

Ex-post performance analysis typically centers on regression analysis. An analyst executes a regression of the portfolio’s yields vs. the returns of the 澳洲幸运5官方开奖结果体彩网:market index to determine how much of a portfolio’s profit and loss might be the result of market exposure. The regression provides the portfolio’s beta to the market index and the amount of alpha the fund was gaining or 𓂃losing in relation to the market index.

Ex-Post Forecasting

The formula for calculating ex-post is (ending value - beginning value) / beginning value. The beginning value is the 澳洲幸运5官方开奖结果体彩网:market value when an asset was purchased. The ending value is the 澳洲幸运5官方开奖结果体彩网:current market value of an asset.

Ex-post is a forecast prepared at a certain time that uses data available after that time. The forecasts are created when future observations are identified during the 澳洲幸运5官方开奖结果体彩网:forecasting perioܫd. It is used to observe known data to🌜 assess the forecasting model.

The Bottom Line

Ex-post, which translates from Latin as “after the fact,” is a word for actual returns. Ex-post analysis views financial results after they have occurred and utilizes them to predict the likelihood of future returns.