Why can contributions distort portfolio return?

Adding money increases the ending balance even if the investments did not perform well. A performance calculation should separate external cash flows from investment gain.

Why is the annualized return only an estimate when I enter contributions or withdrawals?

The period return uses Modified Dietz with one average flow date, so annualizing it gives an estimate. An exact CAGR requires no intermediate cash flows; an exact money-weighted return (XIRR) requires dated cash flows; an exact time-weighted return requires valuations around those flows.

What is the difference between TWRR and money-weighted return?

Time-weighted return isolates investment performance across sub-periods, while money-weighted return reflects the size and timing of investor cash flows. Both require more detailed data than totals alone.

PORTFOLIO PERFORMANCE • RETURN • DRAWDOWN

Portfolio Performance Calculator

Measure portfolio performance without hiding the effect of cash flows, costs or drawdowns.

Total ending wealth—

Investment gain—

Modified Dietz return—

Annualized estimated return—

Benchmark ending value—

Drawdown from peak—

What this means

Benchmark comparison

The benchmark applies the same net cash flows and the same average timing assumption, so the comparison is cash-flow-matched even when contributions or withdrawals exist.

BENCHMARK

Your ending wealth—

Benchmark—

Excess / shortfall—

Performance summary

A transparent summary of invested capital, ending value and the metrics that can be computed from the data provided.

Metric	Value

METHODOLOGY

Cash-flow-aware portfolio performance

Modified Dietz estimate

External contributions and withdrawals are weighted by the portion of the period they were invested. It is more informative than subtracting flows without considering time.

Matched benchmark

The benchmark applies the same net cash flow and average timing assumption, making the comparison more consistent.

Important limitation

Grouped flows are still an estimate. Exact money-weighted return needs dated cash flows; exact time-weighted return needs portfolio valuations around external flows.

Method reference: GIPS Standards Handbook for Firms.

Important: the headline return is a Modified Dietz estimate — net external flows are weighted by one average timing assumption, so it is not an exact money-weighted return (XIRR) or an exact time-weighted return. The annualized figure is an estimate derived from that return and equals an exact CAGR only when no contributions or withdrawals exist. Exact XIRR needs dated cash flows; exact time-weighted return needs sub-period valuations.