How returns are measured

The return on a filing

A return is how much a stock went up or down, as a percentage. Every return on Paydirt is measured on one reported purchase, over 21 trading sessions. A trading session is one day the stock market is open, so 21 sessions is about a month.

The measurement starts at the opening price of its entry session, the first day counted for that trade, and ends at the closing price 20 sessions later. A return only exists when the report and the stock prices around it are both on record. If the 21 sessions are not over yet, the trade shows as not yet priced. Sales are shown as filed, but Paydirt does not measure a return on them.

From execution, and from disclosure

Each purchase is measured twice. The first return starts on the day of the trade, and only the person who made the trade could have gotten it. The second return, the delay-adjusted one, starts on the day the report became public, the first day anyone reading it could have acted.

The difference between the two shows what the reporting delay cost or saved. Both numbers sit side by side on every profile, next to the median delay: the typical number of days between a trade and its report.

The average, and the Impact on $10,000

The return boxes on a profile show an average. Paydirt adds up the 21-session returns on all of a person's priced purchases, divides by how many there are, and shows that number of trades too.

The Impact on $10,000 chart and the performance page work differently. They show how a pretend $10,000 would have grown if it copied each reported purchase from the day it became public, with gains building on gains. An average and a growth chart answer different questions, so for the same person they can point in different directions.

The chart is an equal-weight index: on each trading day, every open purchase counts the same, no matter how big it was, and that day's return is the average of theirs. On a day with no open purchase, the return is zero and the money counts as cash.

The chart is compared with the S&P 500 ETF (SPY), a fund that follows 500 large US companies, starting from the same $10,000 on the same first day. Paydirt does not try to model how much money could really go into each trade. The chart measures reported trades; it is not a tradeable account.

When a filer gets a curve

A person gets their own chart once they have at least five priced purchase groups in the past 24 months. A group is one report's purchases of one stock, added together. The chart appears after the next nightly update, so it can show up a day or two after the person reaches five.

Shorter views, like year to date, are cut from the same 24-month chart and restarted at $10,000. Some common investing measures are left out on purpose: maximum drawdown, annualized return and Sharpe ratios are not displayed.

The binding text

This page explains how things work. The official rules are in section 3 of the terms. Every number Paydirt works out is labeled derived where it appears, and nothing on Paydirt is a recommendation.