Money-Weighted Return Calculator
Money-weighted return is the internal rate of return on your actual cash flows: the single periodic rate that ties together your initial investment, any contributions or withdrawals, and the final portfolio value. Because it weights each period by how much money was at work, it captures your real outcome, not just the underlying investment's performance. This calculator takes your initial outlay, up to three interim net cash flows, and the ending value, then solves numerically for the per-period money-weighted return. All figures are your own.
Money-weighted return formula
Solve for r such that:
init + cf1/(1+r)^1 + cf2/(1+r)^2 + cf3/(1+r)^3 - end/(1+r)^N = 0
r is the money-weighted return per period
N is the number of periods to the end
Contributions are positive cash invested; the ending value is treated as a terminal inflow when the position is closed. The rate r is found by numerical search because there is no algebraic solution for several periods.
About money-weighted return
- It is the internal rate of return applied to portfolio cash flows.
- Large or well-timed contributions strongly influence the result.
- It captures the investor's actual experience, unlike time-weighted return.
- Multiple sign changes in cash flows can produce more than one IRR.
- Enter the rate-relevant period count so the per-period rate is meaningful.
Money-weighted return: frequently asked questions
What is money-weighted return?
Money-weighted return is the internal rate of return (IRR) of a portfolio's cash flows. It is the single periodic discount rate that makes the present value of all contributions and withdrawals, plus the ending value, equal to zero. Because it weights each period by the amount invested, it reflects the investor's actual experience.
How is money-weighted return calculated?
It solves for the rate r in: initial outflow + sum of each period cash flow / (1 + r)^t + ending value / (1 + r)^N = 0. There is no closed-form solution for multiple periods, so it is found numerically. This calculator uses an iterative bisection solver to find the rate.
How does it differ from time-weighted return?
Money-weighted return is affected by the size and timing of cash flows, so a large deposit just before a strong period boosts it. Time-weighted return strips out cash flow timing to measure pure investment performance. Use money-weighted to judge your own outcome and time-weighted to judge a manager.
What sign convention should I use for cash flows?
Enter money you put in (contributions) as positive and money you take out (withdrawals) as positive in the ending value or as negative interim flows. In this calculator, the initial investment and any further contributions are positive amounts invested, interim withdrawals are negative, and the ending value is what the account is worth at the end.
Can the money-weighted return be unsolvable?
With multiple sign changes in the cash flows, the IRR equation can have more than one solution or none. This calculator searches a wide rate range and returns a result when a single rate balances the flows. If the flows are unusual, treat the figure with care and check it against the time-weighted return.
Official sources
- U.S. Securities and Exchange Commission: Total return.
- U.S. Securities and Exchange Commission: Compound interest.
Reviewed by the CalculatorHub team, edited by James Graham, 16 June 2026. See our methodology.