What is a 'MoneyWeighted Rate Of Return'
A moneyweighted rate of return is a measure of the rate of return for an asset or portfolio of assets. It is calculated by finding the rate of return that will set the present values of all cash flows and terminal values equal to the value of the initial investment. The moneyweighted rate of return is equivalent to the internal rate of return (IRR).
Next Up
BREAKING DOWN 'MoneyWeighted Rate Of Return'
There are many ways to measure returns for assets, and it is important to know which method is being used when reviewing asset performance. Moneyweighted rate of return incorporates the size and timing of cash flows, so it is an effective measure for returns on a portfolio. Another popular return calculation is the TimeWeighted Returns method.
RELATED TERMS

Portfolio Return
The monetary return experienced by a holder of a portfolio. Portfolio ... 
Return
The gain or loss of a security in a particular period. The return ... 
The Net Internal Rate Of Return ...
A measure of a portfolio or fund's performance that is equal ... 
Mean Return
1. In securities analysis, it is the expected value, or mean, ... 
Internal Rate Of Return  IRR
A metric used in capital budgeting measuring the profitability ... 
Return On Capital Gains
The return that one gets from an increase in the value of a capital ...
Related Articles

Fundamental Analysis
Calculating the Internal Rate of Return Using Excel
The internal rate of return on investments is explained and illustrated in different investment scenarios. 
Fundamental Analysis
Return on Investment (ROI) Vs. Internal Rate of Return (IRR)
Read about the similarities and differences between an investment's internal rate of return (IRR) and its return on investment (ROI). 
Investing Basics
What's the Rate of Return?
Rate of return is the earnings an asset generates in excess of its initial cost. The amount is usually expressed as an annualized percentage rate. Rate of return can be calculated based on the ... 
Fundamental Analysis
Internal Rate Of Return: An Inside Look
Use this method to choose which project or investment is right for you. 
Fundamental Analysis
Gauge Portfolio Performance By Measuring Returns
Calculate returns frequently and accurately to ensure that you're meeting your investing goals. 
Fundamental Analysis
Explaining Expected Return
The expected return is a tool used to determine whether or not an investment has a positive or negative average net outcome. 
Term
Internal Rate of Return Formula for Excel
The internal rate of return, or IRR, is a popular metric businesses use to measure a projectâ€™s return on investment. 
Investing Basics
More Ways to Evaluate Portfolio Performance
The Jensen measure is another tool investors use to include risk when measuring portfolio performance. 
Investing Basics
How to Calculate Required Rate of Return
Investors use the required rate of return to decide where to put their money, and corporations use it to decide if they should pursue a new project. 
Professionals
How To Measure Returns On The Series 65 Exam
An investor who is evaluating the performance of a portfolio manager must take into consideration the impact that any contributions or withdrawals made by the investor will have on the overall ...
RELATED FAQS

How do I calculate my portfolio's investment returns and performance?
Learn the basic principles underlying the data and calculations used to perform personal rates of return on investment portfolios. Read Answer >> 
How is the expected market return determined when calculating market risk premium?
Find out how the expected market return rate is determined when calculating market risk premium and how these figures are ... Read Answer >> 
What is the formula for calculating the internal rate of return (IRR)?
Learn about the internal rate of return, an important concept in determining the relative attractiveness of different investments. Read Answer >> 
What is the formula for calculating internal rate of return (IRR) in Excel?
Understand how to calculate the internal rate of return (IRR) using Excel and how this metric is used to determine anticipated ... Read Answer >> 
Why is the Modified Internal Rate Of Return (MIRR) preferable to the regular internal ...
See why the modified internal rate of return is often a superior metric to the classic internal rate of return for assessing ... Read Answer >> 
What is the difference between a company's annual return and its annualized return?
Understand the importance of calculating a company's annual return and its annualized return, and learn the differences between ... Read Answer >>