Document Type
Blog Post
Publication Date
11-4-2013
Contents
While a mutual fund manager may make good decisions that result in a positive return, if investors time cash flows incorrectly, they will end up with lower (even negative) returns. This illustrates the difference between time weighted and dollar weighted returns. Unfortunately, the average investor succumbs to human nature, buying high and selling low, instead of the opposite. See a good summary article here, WSJ.
Recommended Citation
Dolvin, Steven D., "Timing Matters -- Dollar Weighted Returns." (2013). All Chapters. 87.
https://digitalcommons.butler.edu/jmdallchapters/87