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Howard
I believe it's a time-weighted return. If I invest £100 for a year and get 100% returns, then invest another £1000, my personal rate of return should be a value closer to 100% than to 9%. The £100 has been in the market a lot longer than the £1000, but the £1000 is a much larger sum, so you need to weight by time. If you just do a simple money out over money in calculation you get a return that doesn't make much sense.