What's the best way to calculate performance when you make regular withdrawals from your account (and deposits as well) ?
My statement shows performance according to various measures (time weighted return ,IRR) but I don't see them as accurate especially since it's calculated over a period of less than a year, in the end I am interested in a cash on cash return measure. How much I made vs total capitalr held in the account.
Given that over the year I make several small withdrawals generally of similar amounts and spaced more or less equally in time, I have used this formula :
(Ending equity - starting equity + total withdrawals ) / Starting equity
Is this a fair and roughly accurate representation of an account performance given the above assumptions ?
What do you use to calculate your performance in a professional way?
My statement shows performance according to various measures (time weighted return ,IRR) but I don't see them as accurate especially since it's calculated over a period of less than a year, in the end I am interested in a cash on cash return measure. How much I made vs total capitalr held in the account.
Given that over the year I make several small withdrawals generally of similar amounts and spaced more or less equally in time, I have used this formula :
(Ending equity - starting equity + total withdrawals ) / Starting equity
Is this a fair and roughly accurate representation of an account performance given the above assumptions ?
What do you use to calculate your performance in a professional way?