What explains my underperformance versus the benchmark?
A performance question asks what a portfolio has actually returned. The answer keeps the money you paid in apart from the money the investments made, which is why a time-weighted and a money-weighted return can differ so much on the same account.
Worked through on a sample portfolio. The figures below are that portfolio’s, not yours.
Here are the main, data-backed reasons your portfolio underperformed the benchmark (HSBC MSCI World UCITS ETF) over the period 12/05/2021–10/09/2026.
| Driver | Figure (period) |
|---|---|
| Absolute portfolio return (time-weighted) | +45,96% |
| Benchmark return (HSBC MSCI World UCITS ETF) | 75,79% |
| Excess return (portfolio vs benchmark) | -30,59 percentage points |
| Allocation: lower ETF share than benchmark | Current ETF allocation 31,21% vs benchmark tilt to broad world equities |
| High concentration in top holdings | Top 1: 18,41%; Top 5: 65,64% |
| Large exposure to Technology (vs broad market) | Technology weight 39,98% |
| Significant crypto allocation (distinct performance) | Crypto weight 8,61%; contribution to returns mixed |
| Cash and precious metal holdings (low return vs equities) | Cash weight 6,06%; Precious metal weight 5,03% |
| Individual holding selection effects | Major positive contributors: Microsoft Corp., Xtrackers MSCI USA UCITS ETF 1C, Apple Inc.; one notable drag: Ethereum |
| Market-cap tilt vs benchmark | Mega Cap weight 53,51%; ETF benchmark may have different cap exposure |
What this means (from your data)
- Your portfolio’s time-weighted return is +45,96%, while the benchmark delivered 75,79%, giving an excess of -30,59 percentage points.
- The gap combines allocation effects (less in broad ETFs and some cash/metal/crypto exposures) and selection/concentration: large weights in a few names and crypto produced results that differ from the benchmark’s broad world equity performance.
- Individual winners (e.g. Microsoft Corp., Apple Inc.) helped returns, while Ethereum and non-equity buckets reduced relative performance.
If you want, I can break the gap into allocation vs selection contributions using your holdings over the period.
This page in other languages
Related questions
See this for your own portfolio
The assistant answers the same question about your own holdings, with your figures and today’s prices. Import from your broker, or open the demo portfolio and ask it there.