Set Up Mutual Fund Calculations

The values in these columns can be maintained using either the PACE entity maintenance windows, PACE uploaders, or the Account Reference Manager (ARM) system. For share classes that do not have redemption fees, the value in these columns is NULL.

You can add new code and code values to control the input of valid redemption frequencies for your share class structures. Then, if you or the loader enters an invalid frequency, it is not used in the calculations.

The feature is backwards compatible, that is, nothing changes the returns you calculated previously when you do not need this feature.

Set Up Precision and Rounding for Intermediate Values

The dynamic mutual fund return calculator allows you to control the precision for many of the variables used in the intermediate steps of the return calculation. You can round or truncate these values to any level of precision.

PACE uses the full precision of the values stored in the database when calculating returns. Loading the database with a specific precision can control the precision of some inputs to the mutual fund return calculation. For example, if you want to round NAVs to three significant digits, load the NAV to only three significant digits. The precision of some of the inputs need to be controlled in this way, such as the offer prices used in the calculation of a front-end load-adjusted return and the reinvestment shares used to calculate dividend shares and dollars.

About Configurable Rounding

The dynamic mutual fund performance calculation is a two step process:

• First, stored fund accounting data is retrieved from the database.

• Second, an internal algorithm processes the data to derive a return.

PACE provides optional settings, called Rounding Options, to control the precision (after the decimal point) of the intermediate values used in the return calculation process.

Rounding options are comprised on a system wide set of rounding options applied to all dynamic mutual fund performance fields. You can override the system wide set of rounding options by creating additional sets of rounding options and assigning them at the entity level. Setting up rounding options at the entity level is useful when entities based in different jurisdictions require different rounding assumptions, or when a single Eagle Performance installation supports entities previously processed by legacy systems that used different rounding assumptions.

Rounding options are optional. Each firm has different requirements with respect to the calculation. Some analysts do not use rounding, while others might only round the offer price and reinvest share values. Eagle does not provide best practices for the use of rounding options. Analysts must choose which, if any, values need to be rounded. If you do not use rounding options, each intermediate calculation uses full precision. Many of the variables are inputs to other calculations; therefore Eagle strongly recommends that any rounding settings be tested before being put into production.

It is important to note that the rounding options pertain only to the internal calculations and not the stored NAV data. Controlling the precision of the underlying fund accounting data is not supported at the system level. If you have precision requirements surrounding the fund accounting data, this should be controlled either during the extract process (from fund accounting) or during the uploading of the NAV file.

Rounding Options Example

Assume you have an NAV of 10.00 and a front end load of 5.00%. The baseline offer price calculation is [NAV / (1-load pct)]. This formula (unrounded) results in an offer price of 10.5263157895 [$10.00 / (1 - .05) = 10.5263157895].

If you use the option to round the offer price, PACE rounds the calculated value to $10.53. This value is then used to derive the starting share balance for the return calculation.

Eagle’s rounding options allow you to either round up or truncate a given intermediate value, and to specify the precision, or number of places after the decimal point, for that value. The following example shows how the system rounds the Offer Price when you round up or truncate using different precision:

     Sample value:                                           10.5263157895

     Round up (2 places):                                         10.53

     Truncate (2 places):                                          10.52

     Round up (3 places):                                         10.526

     Truncate (3 places):                                          10.526

Intermediate Values That Can Be Rounded

You can specify the decimal precision and rounding method (round up or truncate) for 11 intermediate values. The following table describes these intermediate values.

Apply Rounding Options During Reporting

During reporting, the system applies the system wide rounding options you defined to all dynamic mutual fund performance fields included in the Dynamic NAV Returns report or Performance Analysis report. This applies both to new fields as well as those you are already using in existing reports. If you create additional sets of rounding options and apply those sets to specific entities, when you process dynamic mutual fund performance fields for those entities, the system uses the entity level rounding options in place of the system wide rounding options.

For each entity processed in the report, the system uses a single set of rounding options. It chooses the appropriate set of rounding options based on the report profile’s Use Entity History setting and ending effective date. The set of rounding options used for an entity does not vary during the analysis period, and does not vary based on the related entities processed for synthetic, convertible, and benchmark calculations.

Set Up a System Wide Default Set of Rounding Options

You can configure a set of rounding options that provide a system-wide default. If you decide to configure the rounding of these values, the system calculates all dynamic mutual fund returns for all entities using this rounding. You can override these system wide rounding options when calculating dynamic mutual fund returns for selected entities. The next section provides details.

If you are installing Eagle Performance for the first time, the system-wide Eagle System Default set of options is available by default, and each of those rounding options is set for full precision with no rounding of intermediate values. You can then change the Eagle System Default values. If you just upgraded from a prior version, the Eagle System Default set of options displays the values entered in your prior version.

To define a set of configurable rounding options:

1. In the Performance Center Setup left navigation pane, click Validation Rules.
   You see the Validations workspace.

2. Click Performance Options in the left navigation pane.
   You see the Performance Options window, displaying the Rounding Options tab.
   
   

   Open

   

   
   In the image above you see the Eagle System Default values provided when you first install Eagle Performance. All values have Rounding Option set to None, so there is no rounding or truncation of intermediate values.

3. For each element for which you want to specify rounding or truncation: Double-click the corresponding number in the Precision Value column, and enter the number of places allowed after the decimal point for that value.

4. Click the corresponding drop-down arrow in the Rounding Option column, and change the value from <None> to either Round Up or Truncate.

5. Click Save.
   The system saves your changes for the selected set of rounding options.

6. After you save your changes, you can configure additional sets of rounding options.
   The next section describes this process.

Set Up Rounding Options to Apply at the Entity Level

You can create additional sets of rounding options to supplement the system wide set of rounding options, named Eagle System Default, and can assign those sets of rounding options to individual entities. The system uses these sets of rounding options to override system wide rounding options when it calculates intermediate values for dynamic mutual fund returns for those entities.

To create a set of rounding options and apply them to an entity:

1. Set up an MFP Rounding Options Sets code value to identify the set of rounding options by adding a new code value as follows:
   –  From any Eagle window, click the Eagle Navigator button to access the eagle Navigator. Enter Codes in the Start Search text box. Click the Codes (System Management Center) link. 
   –  In the Short Desc column, click IMFP_RND_OPTSET. The Codes Values window appears showing values created for the code of MFP Rounding Options Sets for the specified source.  By default, the system identifies the code that names the system wide set of rounding options with the SHORT Name of EGLDFLT and a Long Name of Eagle System Default, for the source Eagle PACE.
   –  Set Source to Eagle PACE, and then click Add. The Code Values dialog box displays.
   –  Enter a Short Name and a Long Name for the set of rounding options, and click Save All. Repeat this process for each set of rounding options you need to create.
   For example, you can enter a Short Name of NORAM and a Long Name of North America. Or can enter a Short Name of 2 and a Long Name of Two Decimal Places.
   
   

   Open

   

   
   From any Eagle window, click the Eagle Navigator button to access the Eagle navigator.
   –  Enter Performance options in the Start Search text box.
   –  Click the Performance Center link to access the Performance options. The Performance Options window appears, displaying the Rounding Options tab.
   
   
   
   

2. At the top of the tab, select the name of the rounding options you want to define. For example, change the name from Eagle System Default to North America. The first time you define the values for a set of rounding options, the system displays a message that it is copying values from <Eagle System Default> to <Name of the Selected Set of Rounding Options>.

3. Click OK.
   The system displays the values at the bottom of the tab for the selected set of rounding options. If you are configuring that set of values for the first time, it uses the values you assigned to the Eagle System Default set of rounding options as default values.

4. Configure each element in the set for which you want to specify rounding or truncation. 
   –  Double-click the corresponding number in the Precision Value column and enter the number of places allowed after the decimal place for that value.
   – Click the corresponding drop-down arrow in the Rounding Option column and change the value from <None> to either Round up or Truncate.
   
   

5. Click Save.
   The system saves your changes for the selected set of rounding options.

6. After you save your changes, you can select another set of rounding options, and repeat this process to enter its precision values and rounding options.
   Be sure to save your changes for each set of rounding options before you choose the next set.

7. Assign the appropriate set of rounding options to individual entities, as needed, using the Mfp Rnd Options Set field in the Entity Details tab.
   If you specify a value for this field, the system uses the selected set of rounding options to calculate intermediate values for dynamic mutual fund returns for this entity. Otherwise, if you leave this field blank and do not specify a set of rounding options for an entity, the system uses the system wide set of rounding options (Eagle System Default set) when it processes dynamic mutual fund returns for that entity. You can also use the generic entity stream to load this data.
   
   

Troubleshooting Rounding Options

You can analyze how these rounding options affect the calculated result by reviewing a level 10 report log. Level 10 logs generate daily details for all funds and fields. Due to the volume of information being written, you may experience slower processing times. Therefore, Eagle suggests using the Submit with Override feature. This allows you to bump up the level of the error logging as well as execute the report for just the fund you wish to research. Running level 10 reports one fund at a time simplifies the analysis and helps minimize report run times.

The logs are helpful in several ways. First, they show the set of rounding options used to process a specific entity. For example:

Next, they show the current settings for all rounding options. For example:

Last, the calculation details in the log reflects the rounded values. This allows you to view the actual details of the calculation.

When you run the report in Submit with Override, remove all entities except for the one fund in question. In the Select the Dates and Entities tab, select the Override the server log level check box and set the log level to a value of 10. After the report runs, open the report results, select the Diagnostics tab, and click the Log File Name button to view the log. For more information, see  Use Performance Analysis Engine Logs.

Tables Used for Storing Rounding Options

The PERFORM database INTERMEDIATE_VALUES_PRECISION table stores the options for determining precision. The following table describes the Intermediate Values Precision table.

Several rows are added to this table for the system wide set of rounding options (Eagle System Default, or EGLDFLT) by the installation scripts, two of which are shown in the following table. The default is to not round the configurable values. The upgrade scripts copy the values you defined for the system wide rounding options in a prior version of Eagle Performance.

The ENTITY_EXT and ENTITY_HIST tables include a char(20) column called MFP_RND_OPTIONS. The default value is NULL.