An investment manager is pleased with their recent investment performance for a particular fund. Suppose that the following applied over the time period from 1 January 2019 to 1 March 2021:

The fund value at 1 January 2019 was $1.01 million

The fund value at 1 February 2019 was $1.04 million

The fund value at 1 March 2019 was $1.12 million, and then $350,000 was immediately withdrawn

The fund value at 1 August 2019 was $800,000 , and then $95,000 was immediately withdrawn and $1.75 million was immediately deposited

The fund value at 1 January 2020 was $2.8 million, and then $350,000 was immediately withdrawn

The fund value at 1 May 2020 was $2.9 million

The fund value at 1 March 2021 was $3.9 million, and then $475,000 was immediately deposited

1.What pieces of information above are not needed in order to calculate the Time-weighted rate of return (TWRR) over the period 1 February 2019 to 1 March 2021?

2.Based on the information above, over the period from 1 February 2019 to 1 March 2021, set out the equation you need to solve for the Money-weighted rate of return (MWRR), and set out the equation you need to solve for the Time-weighted rate of return (TWRR). Assume that both the MWRR and the TWRR are calculated as annual effective rates.

3.Solve for the MWRR and for the TWRR. Give your answers to 3 significant figures.

4.Do you think the investment manager should be pleased with their investment performance over this time? Why or why not?