Did WMF sell bonds at a loss? On Wed, Nov 9, 2022, 4:08 PM Ad Huikeshoven <ad.huikesho...@gmail.com> wrote:
> The WMF does not invest in stocks, only in bonds. > > Op wo 9 nov. 2022 21:51 schreef Andreas Kolbe <jayen...@gmail.com>: > >> Dear Steven, >> >> Thank you for your explanation. I had naively assumed the investment >> income in the "Support and revenue" section of the financial statements was >> only for income *from* investments (i.e. dividend payments etc.), >> without tracking changes in the value *of* investments as well. So what >> you say makes sense. >> >> There is still something odd though. The US stock market dropped in >> 2019–2020 as well, as a result of Covid. The Dow Jones Index went from >> about 26,600 at the end of June 2019 to about 25,000 by the end of June >> 2020, having fallen below 20,000 in the spring. But even so, the WMF had a >> positive investment income of $5.5 million that year.[1] >> >> The following year, 2020–2021, the stock market *rose* very >> substantially, with the DJI going from the said 25,000 to 34,500 by the end >> of June 2021 – an increase of almost 10,000 points. Yet WMF investment >> income was $1 million *less* than the year prior: just $4.4 million.[1] >> >> In the 2021–2022 year, as you say, the stock market went down again, the >> DJI dropping from the said 34,500 to 31,100 at the end of June 2022. So >> that drop is indeed twice as large as the drop in 2019–2020, but to go from >> a $5.5 million *gain* in a year where the DJI dropped by 1,600 points to >> a $12 million *loss* in a year where the DJI dropped by 3,400 points >> struck me as odd. >> >> And I still don't quite understand why the Q3 tuning session forecast a >> $26 million surplus,[2] while the actual surplus turned out to be just $8 >> million. I guess the fact that most of the drop in the markets occurred >> from April onwards could explain part of it. >> >> Andreas >> >> [1] >> https://foundation.wikimedia.org/w/index.php?title=File%3AWikimedia_Foundation_FY2020-2021_Audit_Report.pdf&page=5 >> [2] >> https://commons.wikimedia.org/w/index.php?title=File%3AF%26A_Tuning_Session_FY21-22_Q3.pdf&page=5 >> >> On Wed, Nov 9, 2022 at 7:36 PM Steven Walling <steven.wall...@gmail.com> >> wrote: >> >>> >>> >>> On Wed, Nov 9, 2022 at 10:37 AM Andreas Kolbe <jayen...@gmail.com> >>> wrote: >>> >>>> Dear WMF Finance staff, >>>> >>>> I inquired over a week ago on Meta-Wiki why the WMF is reporting a >>>> negative investment income (–$12 million). There has been no answer to >>>> date.[1] >>>> >>>> I am a layperson, but how can an investment income be negative? Would >>>> you mind sharing what this is about? >>>> >>> >>> You probably didn't get a prompt answer because "how can investment >>> income be negative" is something you could have Googled before asking the >>> finance team. >>> >>> Investments can lose value.* The US stock market has lost a tremendous >>> amount of value over the last year, so it would not be surprising that most >>> investments would have a negative return recently. >>> >>> * https://www.investopedia.com/terms/n/negative-return.asp >>> https://www.finra.org/investors/investing/investing-basics/risk >>> >>> I was also surprised to find that the reported increase in net assets >>>> for the 2021–2022 financial year was "only" $8.2 million. The third-quarter >>>> F&A tuning session published in May (based on data as of March 31) forecast >>>> a far higher surplus, with an increase in net assets of $25.9 million.[2] >>>> >>>> Would you mind sharing what happened in the fourth quarter to reduce >>>> the surplus by so much? >>>> >>>> Best wishes, >>>> Andreas >>>> >>>> [1] >>>> https://meta.wikimedia.org/wiki/Talk:Wikimedia_Foundation_reports/Financial/Audits/2021-2022_-_frequently_asked_questions >>>> [2] >>>> https://commons.wikimedia.org/w/index.php?title=File%3AF%26A_Tuning_Session_FY21-22_Q3.pdf&page=5 >>>> >>>> On Tue, Nov 1, 2022 at 3:45 PM Andreas Kolbe <jayen...@gmail.com> >>>> wrote: >>>> >>>>> Dear all, >>>>> >>>>> The WMF's audited financial statements are now available here: >>>>> >>>>> >>>>> https://upload.wikimedia.org/wikipedia/foundation/2/26/Wikimedia_Foundation_FY2021-2022_Audit_Report.pdf >>>>> >>>>> Some key figures from the page numbered 4 (page 6 in the pdf): >>>>> >>>>> – Net invest income was negative: –$12M (down $16M) >>>>> – Total support and revenue was $155M (down $8M due to that negative >>>>> investment income) >>>>> – Total expenses were $146M (up $34M) >>>>> – Salaries and wages were $88M (up $20M) >>>>> – Net assets at end of year increased by $8M >>>>> >>>>> For reference, the end-of-year increase in net assets forecast in the >>>>> third-quarter Finance & Administration tuning session deck published in >>>>> May >>>>> 2022 was $25.9M: >>>>> >>>>> >>>>> https://commons.wikimedia.org/w/index.php?title=File%3AF%26A_Tuning_Session_FY21-22_Q3.pdf&page=5 >>>>> >>>>> Best, >>>>> Andreas >>>>> >>>>> _______________________________________________ >>>> Wikimedia-l mailing list -- wikimedia-l@lists.wikimedia.org, >>>> guidelines at: https://meta.wikimedia.org/wiki/Mailing_lists/Guidelines >>>> and https://meta.wikimedia.org/wiki/Wikimedia-l >>>> Public archives at >>>> https://lists.wikimedia.org/hyperkitty/list/wikimedia-l@lists.wikimedia.org/message/5M36VZBWLE6P4XCDAVL7L3FEPGNSSQNX/ >>>> To unsubscribe send an email to wikimedia-l-le...@lists.wikimedia.org >>> >>> _______________________________________________ >>> Wikimedia-l mailing list -- wikimedia-l@lists.wikimedia.org, guidelines >>> at: https://meta.wikimedia.org/wiki/Mailing_lists/Guidelines and >>> https://meta.wikimedia.org/wiki/Wikimedia-l >>> Public archives at >>> https://lists.wikimedia.org/hyperkitty/list/wikimedia-l@lists.wikimedia.org/message/QHIQDCPCDC2D7FQROP6ACC4C2JUBP5D5/ >>> To unsubscribe send an email to wikimedia-l-le...@lists.wikimedia.org >> >> _______________________________________________ >> Wikimedia-l mailing list -- wikimedia-l@lists.wikimedia.org, guidelines >> at: https://meta.wikimedia.org/wiki/Mailing_lists/Guidelines and >> https://meta.wikimedia.org/wiki/Wikimedia-l >> Public archives at >> https://lists.wikimedia.org/hyperkitty/list/wikimedia-l@lists.wikimedia.org/message/GLE5RY4BG2DRQFYSPPUOLZMNAA2ONV72/ >> To unsubscribe send an email to wikimedia-l-le...@lists.wikimedia.org > > _______________________________________________ > Wikimedia-l mailing list -- wikimedia-l@lists.wikimedia.org, guidelines > at: https://meta.wikimedia.org/wiki/Mailing_lists/Guidelines and > https://meta.wikimedia.org/wiki/Wikimedia-l > Public archives at > https://lists.wikimedia.org/hyperkitty/list/wikimedia-l@lists.wikimedia.org/message/2GQERECVJTOEN3SSFLTTV6CNDEKWSXR6/ > To unsubscribe send an email to wikimedia-l-le...@lists.wikimedia.org
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