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The '''simple Dietz method'''<ref name="Dietz1966">{{cite book
The '''simple Dietz method''' is a means of measuring historical investment portfolio performance, compensating for external flows into/out of the portfolio during the period.<ref name="Schwab2007">{{cite book|author=Charles Schwab|title=Charles Schwab's New Guide to Financial Independence Completely Revised and Upda ted: Practical Solutions for Busy People|url=https://books.google.com/books?id=QMjjIm2m2ZMC&pg=PA294|date=18 December 2007|publisher=Doubleday Religious Publishing Group|isbn=978-0-307-42041-1|pages=259–}}</ref> The formula for the simple Dietz return is as follows:▼
|author=Peter O. Dietz
|title=Pension Funds: Measuring Investment Performance
|url=https://books.google.com/books?id=ZUQ_MwEACAAJ
|year=1966
▲
:<math>R=\frac{B - A - C}{A +C/2}</math>
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== Derivation ==
The method is named after Peter O. Dietz. According to his book ''Pension Funds: Measuring Investment Performance''<ref name= Dietz1966 />,
:"The method selected to measure return on investment is similar to the one described by Hilary L. Seal in ''Trust and Estate'' magazine. This measure is used by most insurance companies and by the SEC in compiling return on investment in its Pension Bulletins.<ref>{{cite journal|last1=Seal|first1=Hilary L.|title=Pension & Profit Sharing Digest: How Should Yield of a Trust Fund Be Calculated?|journal=Trust and Estates|date=November 1956|issue=XCV|page=1047}}</ref> The basis of this measure is to find a rate of return by dividing income by one-half the beginning investment plus one-half the ending investment, minus one-half the investment income. Thus where ''A'' equals beginning investment, ''B'' equals ending investment, and ''I'' equals income, return ''R'' is equivalent to
::<math>R = I \div {1/2} (A + B - I)</math>
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