What is an attribution analysis?

Attribution analysis is a method for evaluating the relative performance of a portfolio by comparing it to a benchmark. This analysis helps to understand how the portfolio performs in relation to the benchmark.

Attribution analysis examines how different components of the portfolio – such as shares, sectors, or regions – contribute to the total relative performance. The contribution is determined by the under or overweighting of specific sectors, regions or individual securities. This means you can see how strategic choices in the composition of the portfolio have influenced the return compared to the benchmark.