And if we just calculate her personal rate of return, she ends up with $998.89 / $12,000 = 8.32%. So at the closing share price of $205.31 on, the value of Kathryn’s account is $12,998.89. At the end of the year, she’s purchased a total of 63.3135 shares- a smaller overall number of shares than Meredith with the same $12,000 total investment. Then Kathryn invests another $6,000 at that closing price, buying 31.2175 more shares. On, when the closing share price is $192.20 per share, her initial investment is worth $6,168.85. Kathryn, on the other hand, invests just $6,000 at the closing price on. The value of those shares at the close of business on is $205.31 per share, or $13,179.92 total-representing a 9.83% gain. Meredith invests $12,000 into the Vanguard S&P 500 Index ETF (ticker symbol VOO) at the closing price of $186.93 per share on and doesn’t make any more deposits for the year. To better understand different calculation methods, let's consider two examples: And Schwab Intelligent Portfolios ® clients can still see their personal return as a dollar amount on the Portfolio Performance dashboard, but return percentage is shown as a TWR calculation. That said, personal return is still a useful value to consider as the bottom line monetary impact of your investment. Other calculation methods-including your personal rate of return (PRR)-can be skewed by the size and timing of account inflows and outflows, decisions that clients control. We believe that the TWR methodology best represents the true performance of your portfolio because it solely reflects the effects of the market and the investment choices made for you. Time-weighted return (TWR) is the industry standard for managed portfolios and market indexes And you may not be calculating time-weighted return-the method best used to compare investment managers who don't control the timing of deposits and withdrawals. ![]() Do you ever look at an investment's performance and think your return was lower (or higher) than the reported percentage figure? The fact is, there’s more than one way to calculate return.
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