You Have Calculated the Historical Dollar-Weighted Return, Annual Geometric Average

Multiple Choice

You have calculated the historical dollar-weighted return, annual geometric average return, and annual arithmetic average return. You always reinvest your dividends and interest earned on the portfolio. Which method provides the best measure of the actual average historical performance of the investments you have chosen?

A) dollar-weighted return
B) geometric average return
C) arithmetic average return
D) index return