what does twr tell you 
it can be difficult to determine how much money was earned on a portfolio when there are multiple deposits and withdrawals made over time investors can t simply subtract the beginning balance after the initial deposit from the ending balance since the ending balance reflects both the rate of return on the investments and any deposits or withdrawals during the time invested in the fund in other words deposits and withdrawals distort the value of the return on the portfolio the time weighted return breaks up the return on an investment portfolio into separate intervals based on whether money was added or withdrawn from the fund the twr provides the rate of return for each sub period or interval that had cash flow changes by isolating the returns that had cash flow changes the result is more accurate than simply taking the beginning balance and ending balance of the time invested in a fund the time weighted return multiplies the returns for each sub period or holding period which links them together showing how the returns are compounded over time 