Time-Weighted Rate of Return

It's really hard to compare huge pools of investments in an apples-to-apples way. Some of the stocks in a given mutual fund or portfolio could throw off periodic dividends—which is great, but when that happens, it skews the regular rate-of-return number, making it look better than it really should.

So, to figure out what the given portfolio has actually done in the market, the time-weighted return simply looks at the original investment and takes out all the varying cash-flows that occurred. Otherwise, any stock that gives out a healthy dividend would look waaaaay better than one that doesn't. Sometimes we need to just look at how each stock performed, not the stock-and-dividend.

And you thought you had weird hobbies.