Albridge, which provides wealth management services and technology to help financial institutions and advisers determine clients’ assets, says the new IRR and the already-offered Modified Dietz formulas enable financial advisers to use a dollar-weighted calculation when figuring out a client’s portfolio performance. This means advisers will take into greater account the timing and size of cash flows in and out of a portfolio and their impact on portfolio performance over time.
The DTWR calculation is more geared toward asset managers looking to follow the CFA Institute standards for measuring their investment performance, which means the calculation is less impacted by the timing and size of cash flows on performance over time, according to a company press release.
The calculation can be made anytime, as well as on a cyclical basis.
“In expanding the range of rate of return (ROR) calculation options, Albridge is now providing individuals and asset managers with an unmatched level of choice in selecting calculations for measuring and reporting on performance at the individual holding, asset class, account, investor and consolidated portfolio levels,’ said Jake Rohn, executive vice president, Albridge Solutions, in the press release.
For more information visit www.albridge.com.