Definition of 'Modified Dietz Method'
A method of evaluating a portfolio's return based on a weighted calculation of its cash flow. The Modified Dietz Method takes into account the timing of cash flows, and assumes that there is a constant rate of return over a specified period of time. The Modified Dietz Method is more accurate than the Simple Dietz Method, which assumes that all cash flows come from the middle of the period of time being evaluated.
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