- This topic has 4 replies, 4 voices, and was last updated Dec-211:26 am by
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Up6
Apologies, a coworker pointed out that this can be found in Reading 6: Overview of the Global Investment Performance Standards. Mods feel free to delete.
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Up4
Modified Dietz is an Arithmetic way of calculating time weighted rate of return which negates the effect of timing of the cashflows so as to avoid the fund manager being rewarded or penalized for the investers decision of adding or withdrawing cashflows from the funds or portfolios. It is used in traditional fund setup where fund manager does not control the timing of the cashflows.
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Up3
Hey fellow lefty – it is in the L3 curriculum, volume 1.
Hidden under GIPS (Reading 6), section 3.3 under “3.3. Calculation Methodology: Time-Weighted Total Return”.
Don’t panic, there is still time!
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Up3
Just think of it this way, it takes into account the TVM of cash flows as they come and go within a period.
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