Let’s just illustrate the idea of TWR and MWR using an example.
Initial capital: $100
End of year amount: $125
MWR = 25%
TWR = 10% (assumed)
So assuming that TWR is lower at a value of 10%, in the time domain, it means that I only need a 10% gain to reach the same amount of $125 end of year as compared to needing a 25% gain in terms of capital outlay.
In other words or simpler terms, you timed the market very well for TWR to be always lower than MWR. That is already mentioned by our fellow IN peeps in your other thread on TWR.
I may be wrong but that’s the general concept I get. Hope it helps
Thanks for sharing. Just one of the very (very) few people here that share good quality information.
good read.
I know the real name of GFH fund. ;)
Reply to @ThumbTackInvestor : I'm not serious. :)
Let’s just illustrate the idea of TWR and MWR using an example.
Initial capital: $100
End of year amount: $125
MWR = 25%
TWR = 10% (assumed)
So assuming that TWR is lower at a value of 10%, in the time domain, it means that I only need a 10% gain to reach the same amount of $125 end of year as compared to needing a 25% gain in terms of capital outlay.
In other words or simpler terms, you timed the market very well for TWR to be always lower than MWR. That is already mentioned by our fellow IN peeps in your other thread on TWR.
I may be wrong but that’s the general concept I get. Hope it helps
Reply to @ThumbTackInvestor : Kidding la bro. Haha.