implementation shortfall question

LPoulin133

CFAI vol. 6 page 58 question 10 B.

I have not seen this formula for implementation shortfall ?!!!

wake2000

Thanks again.

infinitybenzo

No. I do not believe so. There are two previous closing prices- if I recollect correctly.
Problem specifically states which one to take.

cityboy

Hey thanks DS. Quick question, ifyou dont mind, so if we are averaging the prices for calculation of RP/RL, would we also average the prices for the delay costs? as this would also involve two separate delay costs if they are made during a span of a couple of days.

Thanks

oneboy

I don't know if you guys remember, but I was doing an IS problem, where the securities were purchased at different prices and they used the average prices of the purchase to calculate the realized profits/losses.

Any idea where this was? I think it would have been in one of the Schweser exams, not sure.

But is that concept right? Or do we have to calculate the realized profits individually for each purchase price?

Iginla2011

you mean the midpoint thing? Theyre just saying if presented with a bid ask spread instead of a price benchmark to use the midpoint as your benchmark.

aidebaobao

THanks jut111

I was struggling with this one.

justin88

why do you care?

If you know one formula - then you will get the right answer