Our process:

1. We assume that the hypothetical portfolio has $200,000 USD. 
2. This gives us 20 available $10000 slots. 
3. Note:  We do not exceed the 20 slots, even when we average down. 
4. We calculate the dollar gain everytime we sell a position plus the gain return on our open positions.  We take that total dollar gain and divide by $200,000. 
5. Of course as the portfolio gains, it will create more slots or hypothetical cash from our selling winners.  Our percentage hypothetical ROI is updated daily.
6. Periodically we update the gain/loss to reflect dividends, splits and other corporate actions.
7. We assume any cash sits in a moderately performing bond fund which has no redemption penalty for easy access.

This is the same way you would do it for your own portfolio or the way your broker calculates gain/loss.