Money-Weighted Return Calculator

About this calculator

The money-weighted rate of return (MWRR) — also called the dollar-weighted return — is an IRR-style measure of investment performance that accounts for the exact size and timing of cash flows into and out of a portfolio, unlike the time-weighted return used for comparing fund managers, which strips out the effect of contributions and withdrawals entirely. MWRR is solved by finding the single discount rate at which the present value of all cash flows (beginning balance, any mid-period contributions or withdrawals, and ending balance) nets to zero, typically via an iterative bisection or Newton's-method solve rather than a closed-form formula.

Individual investors, financial advisors, and retirement planners favor MWRR because it reflects what actually happened to an investor's own money — if you added a large contribution right before a market rally, MWRR gives you credit for that good timing, whereas a time-weighted return would not. This makes it the more personally relevant number for someone asking ‘how well did my actual account perform,’ as opposed to ‘how well did the underlying strategy perform regardless of my cash-flow timing.’

This calculator takes your beginning balance, a contribution made partway through the period, your ending balance, and the number of years, then uses an IRR-style bisection solve to return your money-weighted annual return.