Performance Perspectives Blog

Annualizing performance attribution

by | Nov 26, 2013

I was in Australia (both Sydney and Melbourne) last week, (1) speaking at a conference, (2) conducting a conference workshop, and (3) teaching our two-day attribution class. It was a very hectic time, and I failed to do any posting, which is a bit unusual for me.

Yesterday, we held our monthly “Think Tank” session, and one caller asked about “annualizing attribution.” I found this to be quite an intriguing topic.

It occurred to me that there are three issues that must be considered:

  1. Should we even be reporting attribution for periods greater than a year?
  2. If yes, should we annualize?
  3. If yes, how (i.e., what are the mechanics)?

At the present time, I’m not sure that it’s advisable to extend attribution past a year, but need to give this some more thought, as well as discuss the topic with a few colleagues. My concern is that longer period results might “smooth out” the details and provide little benefit to the recipient. However, they may also prove to be quite insightful! In addition to chatting, I will most likely conduct some testing, too, to discover what we might learn.

In the mean time, if you have any thoughts, please let me know.