or each of the last six quarters, Managers L and M have provided you with the total dollar value of the funds they manage, along with the ontributions or withdrawals made by their clients. (Note: Contributions are indicated by positive numbers, withdrawals by negative numbe MANAGER L MANAGER M Total Funds Contributions/ Total Funds Contributions/ Quarter Under Management Withdrawals Under Management withdrawals Initial $487,000 $699,000 1 513,000 11,000 688,000 -37,000 2 529,000 5,500 666,000 -37,000 3 542,000 11,500 617,000 -37,000 4 577,000 2,500 631,000 -37,000 5 604,000 17,000 611,000 -37,000 pr each manager, calculate: a. her money-weighted return. Do not round intermediate calculations. Round your answers to two decimal places. Money-weighted return (Manager L): % Money-weighted return (Manager M): % b. her time-weighted return. Do not round intermediate calculations. Round your answers to two decimal places.

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
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For each of the last six quarters, Managers L and M have provided you with the total dollar value of the funds they manage, along with the quarterly
contributions or withdrawals made by their clients. (Note: Contributions are indicated by positive numbers, withdrawals by negative numbers.)
MANAGER L
MANAGER M
Total Funds
Contributions/
Total Funds
Contributions/
Quarter
Under Management withdrawals
Under Management
Withdrawals
Initial
$487,000
$699,000
1
513,000
11,000
688,000
-37,000
529,000
5,500
666,000
-37,000
542,000
11,500
617,000
-37,000
4
577,000
2,500
631,000
-37,000
5
604,000
17,000
611,000
-37,000
For each manager, calculate:
a. her money-weighted return. Do not round intermediate calculations. Round your answers to two decimal places.
Money-weighted return (Manager L):
%
Money-weighted return (Manager M):
%
b. her time-weighted return. Do not round intermediate calculations. Round your answers to two decimal places.
Time-weighted return (Manager L):
%
Time-weighted return (Manager M):
%
c. estimates of her quarterly performance returns using the Dietz approximation method, assuming contributions/withdrawals are made exactly
halfway through the quarter. Do not round intermediate calculations. Round your answers to two decimal places. Use a minus sign to enter
negative values, if any.
Quarter
Return (Manager L) Return (Manager M)
1
%
%
%
3
%
4
%
%
5
%
%
Transcribed Image Text:For each of the last six quarters, Managers L and M have provided you with the total dollar value of the funds they manage, along with the quarterly contributions or withdrawals made by their clients. (Note: Contributions are indicated by positive numbers, withdrawals by negative numbers.) MANAGER L MANAGER M Total Funds Contributions/ Total Funds Contributions/ Quarter Under Management withdrawals Under Management Withdrawals Initial $487,000 $699,000 1 513,000 11,000 688,000 -37,000 529,000 5,500 666,000 -37,000 542,000 11,500 617,000 -37,000 4 577,000 2,500 631,000 -37,000 5 604,000 17,000 611,000 -37,000 For each manager, calculate: a. her money-weighted return. Do not round intermediate calculations. Round your answers to two decimal places. Money-weighted return (Manager L): % Money-weighted return (Manager M): % b. her time-weighted return. Do not round intermediate calculations. Round your answers to two decimal places. Time-weighted return (Manager L): % Time-weighted return (Manager M): % c. estimates of her quarterly performance returns using the Dietz approximation method, assuming contributions/withdrawals are made exactly halfway through the quarter. Do not round intermediate calculations. Round your answers to two decimal places. Use a minus sign to enter negative values, if any. Quarter Return (Manager L) Return (Manager M) 1 % % % 3 % 4 % % 5 % %
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