Financial Planner

Answer: A - Time-weighted return measures for investment returns by computing the return for each period and takes the average of the results. It finds the holding period for each period and averages them. If the investment is for more than one year, take the geometric mean of the annual returns to find the time weighted rate of return for the measurement period. The time-weighted return is the preferred method of performance measurement because it is not affected by the timing of cash flows.