Published Article Details

What is money weighted rate of return?

Posted by: Labdhi Mehta on Oct 23, 2017, 06.30 AM IST

1. MWRR is a method to calculate the rate of return of a portfolio.

2. MWRR takes into consideration the impact of contributions to, or withdrawals from the portfolio.

3. If an investor contributes a significant sum into a portfolio just prior to the portfolio's performance rising, this larger portfolio benefits more in rupee terms than if the contribution had not been made.

4. If investor withdraws a large sum from portfolio just prior to portfolio's performance rising, this smaller portfolio benefits less from portfolio's growth than if the withdrawal had not been made.

5. It is mainly used to compute individual portfolio returns as timing and amount of contributions and withdrawals can be different for each individual investor's portfolio.

6. MWRR helps to assess personal portfolio performance relative to your individual financial plans and projections.

(The content on this page is courtesy Centre for Investment Education and Learning (CIEL). Contributions by Girija Gadre, Arti Bhargava and Labdhi Mehta.)

Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of This article appeared in Economic Times dated Oct 23, 2017, 06.30 AM IST

Online Courses

Financial Planning
Advance Level

Meet the fast-growing demand of an economy that is drawing foreign investors, particularly NRIs. This cours

Financial Planning
Basic Level

People are discovering how financial planning can help their money grow and prepare for a more secure futur

Financial Planning
Advance Level

Learn how to measure investment performance through analysing Returns on Investment (ROI) through this onli

Financial Planning
Advance Level

Understand the nature of investment risk with our course on measuring investment risk and how to manage it.

Financial Planning
Advance Level

Learn to construct portfolios and the techniques used to allocate assets across classes and manage risk.