In measuring the performance of a portfolio, the time-weighted rate of return is superior to the dollar-weighted rate of return because:a. When the rate of return varies, the time-weighted return is higher.b. The dollar-weighted return assumes all portfolio deposits are made on day 1.c. The dollar-weighted return can only be estimated.d. The time-weighted return is unaffected by the timing of portfolio contributions and withdrawals.
In measuring the performance of a portfolio, the time-weighted rate of return is superior to the dollar-weighted rate of return because:a. When the rate of return varies, the time-weighted return is higher.b. The dollar-weighted return assumes all portfolio deposits are made on day 1.c. The dollar-weighted return can only be estimated.d. The time-weighted return is unaffected by the timing of portfolio contributions and withdrawals.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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In measuring the performance of a portfolio, the time-weighted
a. When the rate of return varies, the time-weighted return is higher.
b. The dollar-weighted return assumes all portfolio deposits are made on day 1.
c. The dollar-weighted return can only be estimated.
d. The time-weighted return is unaffected by the timing of portfolio contributions and withdrawals.
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