Understanding the Performance Measurement Enigma
Why the most common method to calculate fund performance does not reflect how most people invest.
Comparison of performance based on lump-sum investing versus monthly investing
The outcome of three withdrawing strategies in retirement over 25 years
Why diversified portfolios provide resilience compared to single-asset investments under different investment scenarios
The standard method of measuring the performance of exchange-traded funds (ETFs) and mutual funds is to assume that money was invested all at once (a lump-sum investment) and no additional money was invested or withdrawn. Is that how most people invest? I doubt it. Is there a measure of performance that is more realistic? In this article, I present performance results based on two different assumptions: (1) monthly investments and (2) money withdrawn annually.
