To a large extent, I agree with you that
12 month periods are baked in as intuitively obvious. That said, I disagree that the
12 month period must be tied to a
calendar year.
When I look at one year performance, I'm looking at the past
12 months (e.g.
10/
17/
17 to
10/27/
18), or maybe the past
12 full months of performance (9/30/
17 to 9/30/
18). For one year performance I'm certainly not going to ignore what's happened between January and October of this year (i.e. I don't look at 20
17 data as a meaningful representation of how a fund did over the past year).
There are even special cases for RMDs that get away from calendar years: you have a fifteen month period in which to take your first RMD (the year you turn 70.5 and up to April
1 of the next year); so you can also take two RMDs within a single calendar year. In addition, there was a calendar year in which no RMDs were required (
2009).
Further, for 40
1(k)s where the fiscal year doesn't match the calendar year, assuming no withdrawals have been made, the value of the account used to compute the RMD is the account value at the end of the fiscal year, not the value at end of the calendar year (Dec 3
1). Here's a page discussing this:
https://www.irahelp.com/forum-post/21980-rmd-fiscal-year-based-profit-sharing-planFor performance comparison purposes, funds must use standardized periods. This is to prevent cherry picking. For example, they can't advertise their performance starting the day the market hit bottom. The use of calendar quarters for comparisons is indeed arbitrary, but the very arbitrariness of these dates means that no fund is benefited or disadvantaged by the choice of dates.
Even here, the yearly periods are not calendar years; they cover twelve months through the end of the last quarter, not the last year. Yes,
12 month periods are baked in. No, figures are often not anchored on Jan
1, except YTD figures. And on Feb 25, does one really care about YTD?
How to Read a Performance Advertisement that Describes a Mutual Fund’s Total Returnhttps://davisfunds.com/downloads/04readingfndadv.pdf
