The money-weighted rate of return is the discount rate that equates the present value of all cash inflows to the present value of all cash outflows for an account. It is the internal rate of return of the investor’s actual cash flows, so large deposits and withdrawals shape the result. It measures the client’s personal experience more than pure manager skill when cash-flow timing is outside the manager’s control. People confuse it with time-weighted return, which removes the effect of external cash flows.