CFA CFA Level 3 Portfolio Management TWRR vs MWRR

Portfolio Management TWRR vs MWRR

  • This topic has 4 replies, 3 voices, and was last updated Apr-20 by fabian.
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    • frankthethank
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      A portfolio manager is EXPECTING a cash flow inflows in 17 days. Should he calculate his future return using TWRR or MWRR?

      Expecting.. So he has no control of funds?

      Shag should we use here?

      Thanks

    • artyeasel
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      A portfolio manager is EXPECTING a cash flow inflows in 17 days. Should he calculate his future return using TWRR or MWRR?

      Is that all the information the question gave?

      If so, I would go for TWRR (investing when you’ve received money) rather than MWRR (investing at a timing of your choosing).

    • frankthethank
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      Yup that’s all the info, expect that kind of question in level 3…

    • frankthethank
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      So since he does not have total control I guess we should use TWRR

    • fabian
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      Agree with TWRR. I think about it this way: if the PM can’t invest according to THEIR timeline, TWRR.

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