Investment Research Expert Witness Ltd
The Investment Research Partnership
Daniel v Stanley Tee Solicitors
Calculation of historic investment losses from 2000 to 2002
In this case, the beneficiaries of a trust claimed that trustees of their father’s estate trust had been mismanaged in the period 2000 to 2002 whilst they were still minors. It was necessary to calculate losses for a short period of 2 years using benchmarks and market indices appropriate to the investment period rather than relying on current (2015/16) indices.
One of the often misunderstood aspects of sector averages and benchmarks is that that they get rebalanced periodically. This means that what constituted a suitable range of funds or equities that made up a sector average/index, has changed and often beyond what could be considered similar to the relevant period.
At The Investment Research Partnership, we hold performance data and sector average returns from before the year 2000. This means we can provide quantum values based upon what was considered relevant at the time and not based on current sector weightings. This can make a considerable difference in values, and one that is often underestimated. Further by using these historic values, the estimated quantum values are harder to challenge in court.
In this particular case, having calculated the estimated losses for the relevant period, these losses were then continued through to the current day, again using relevant sector averages appropriate to the relevant period.