How to use the portfolio return calculator
The calculator has two tools.
Weighted return combines the returns of your holdings over one period:
- Choose how to size each holding: its dollar value at the start of the period, or its weight in percent.
- List the holdings with their return over the period, including dividends and interest. Your brokerage statement or each fund’s factsheet shows the total return.
The results show the portfolio return, the dollar gain, each holding’s contribution and how the mix drifted by the end of the period.
Time-weighted vs money-weighted handles a portfolio with deposits and withdrawals:
- Enter one row per period, oldest first: the value at the start, any deposit (positive) or withdrawal (negative) made at the start, and the value at the end.
- Choose the length of each period, so the results can be annualized.
The formulas
Time-weighted return = (1 + r1) × (1 + r2) × … × (1 + rn) − 1CFt is the deposit (+) or withdrawal (−) at the start of period t. Annualized: (1 + TWR)N÷n − 1, where N is the number of periods in a year and n the number of periods.
Worked examples
Weighted return. A $100,000 portfolio holds five positions. The US stock index fund, 40% of the portfolio, returned 12% and contributed 4.80%. Company A shares lost 18%, but as only 10% of the portfolio they took away 1.80%. Adding all five contributions gives a portfolio return of +5.34%, a gain of $5,340.00. The simple average of the five returns, +1.70%, is far off because it treats the small losing position as if it were as large as the others.
Time-weighted vs money-weighted. An investor starts with $100,000 and has three good quarters. Encouraged, they add $100,000 at the start of Q4 2025, just before a 15% fall. Over the eight quarters, the investments earn a time-weighted return of +2.91% a year. But the investor’s own money earns a money-weighted return of -0.62% a year: the fall hit nearly twice as much money as the earlier gains, and the account finishes with an investment loss of $2,000 on the $200,000 put in.
Why the two returns differ
The time-weighted return gives every period the same weight, however much money was invested at the time. The money-weighted return gives more weight to periods when more money was at work. They agree when there are no cash flows, and drift apart when large deposits or withdrawals land just before unusually good or bad periods.
The same eight quarterly returns, with the $100,000 deposit at different times:
| Deposit timing | Time-weighted, a year | Money-weighted, a year | Gain in dollars |
|---|---|---|---|
| Before the fall (the example) | 2.91% | -0.62% | -$2,000 |
| After the fall (Q1 2026) | 2.91% | +4.68% | $14,251 |
| No deposit | 2.91% | +2.91% | $5,907 |
The time-weighted return barely moves, because the investments did the same thing in all three cases. The money-weighted return and the dollar result swing widely with the timing decision. That is the point of each measure: the time-weighted return judges the investments or the manager, while the money-weighted return judges the combined result of the investments and your own decisions about when to add or withdraw money.
Which return to look at
- Comparing a fund or manager with a benchmark: use the time-weighted return. The Global Investment Performance Standards (GIPS) require it for most strategies, because a manager should not look better or worse because of client deposits they did not control.
- Judging your own results: the money-weighted return answers “what did my money earn?” Many brokerage and advisory statements show it as a personal rate of return. A large gap between it and the time-weighted return means your timing of deposits and withdrawals helped or hurt.
- Planning: retirement projections that assume a return are about your money, so the money-weighted figure is the closer comparison.
What this calculator does not include
The time-weighted tool assumes each deposit or withdrawal happens at the start of a period. If money moved in the middle of a period, split the period at that date for an exact result; professional systems value the portfolio on every cash-flow date or use approximations such as the Modified Dietz method. The weighted tool uses weights at the start of a single period; for several periods, calculate each one and chain the returns in the second tool. Neither tool deducts taxes or fees charged outside the holdings, and for periods shorter than a year the annualized figures stretch a short result over a full year.