Content deleted Content added
Added references to the original author's work |
m →Derivation: WP:CHECKWIKI error fixes using AWB |
||
Line 28:
== 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>
| |||