Portfolio turnover rate


Also found in: Acronyms.

Portfolio turnover rate

For an investment company, an annualized rate found by dividing the lesser of purchases and sales by the average of portfolio assets.

Portfolio Turnover Rate

The ratio at which a portfolio trades the securities in it. A higher turnover rate indicates active management; if it becomes very high, this may indicate that the broker or manager is trading securities for the sake of collecting more fees. It is calculated as the trading volume of the portfolio as a percentage of the entire portfolio. See also: Prudent person rule.
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portfolio turnover rate was--% of the average value of its
(2) The average portfolio turnover rate for an actively managed
The portfolio turnover rate can be a little harder to track down (and they are not published for pension funds).
For example, the financial highlights section of the fund's prospectus includes a "turnover rate" or "portfolio turnover rate," designed to measure the number of fund portfolio transactions.
* Investment advisers can dig beyond fund disclosures to detect market-timing by comparing a fund's current portfolio turnover rate to the fund's historic rate.
In addition to a lower portfolio turnover rate, index funds typically have lower management fees than do activity managed funds.
Some equity mutual funds are "tax-managed" funds, which seek to minimize taxes to shareholders by maintaining a low portfolio turnover rate and considering taxes when buying and selling securities.
The resource rates funds using an A-E financial strength system, beginning with an alphabetical list of exchange-traded and other closed-end growth, sector or international, municipal and corporate bonds, and other funds, analyzing factors such as fund type, expense ratio, overall investment rating, price, 52-week high, three-year total return, dividend yield, cash percentage, and portfolio turnover rate. Subsequent sections contain analyses of all exchange-traded funds and other closed-end mutual funds, with graphs and charts, in the areas of investment rating, major ratings factors, fund family and type, inception date, and ticker symbol; the top and bottom funds; the best and worst funds based on performance; and top rated funds by type.
A fund's portfolio turnover rate measures the extent to which its portfolio is turned over in the course of a year.
A high portfolio turnover rate, therefore, in addition to significantly reducing or even eliminating the tax deferral advantage, presents an additional disadvantage to a taxpayer with significant capital losses or a 31% tax rate.
The results contribute to the literature by demonstrating the determinants of the portfolio turnover rates and the factors that distinguish investment funds.
The good news is that services provided by a DIM are not considered designated investment alternatives subject to detailed participant disclosure about expense ratios, performance history, portfolio turnover rates, etc.