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3 / 5 today
Explain
Journal
Reference
Stats
✓ Correct answer: C
MWR weights periods by capital invested. A large contribution before poor performance drags MWR below TWR — more capital absorbed the loss.
✗ Why the others are wrong
A. Contributions before poor returns reduce — not raise — MWR relative to TWR.
LOS
1.2.c
Portfolio Mgmt
Formula
TWR = ∏(1+Rₙ)^(1/n)
Time-weighted return
⚠ Common trap
Confusing cash-flow timing with compound return. MWR ≠ TWR whenever external flows occur.
gpt-5-mini · 1.4s · mock