Dollars Returns
Total Invested Ending Balance Simple Money-Weighted1 Time-Weighted
$30,000 $53,500 +78.3% +111.9% +99.0%

Change the deposit amounts to see how the three returns are affected.

Jan. 2004 deposit

$

Nov. 2007 deposit

$

Mar. 2009 deposit

$

Notice that the time-weighted return is lower than the money-weighted return. That’s because the timing and size of the later deposits is such that the ending balance is higher than if all the money was invested at the same time as the first deposit.

The above chart is the market return of a Betterment portfolio composed of 70% stocks and 30% bonds. The returns are net of the ETF and Betterment fees. The time range shown is January 2004 to November 2013. For more on how we compute model returns, see here. 1 The money-weighted return uses a Modified-Dietz calculation.