You have calculated the historical dollar-weighted return, annual geometric average return, and annual arithmetic average return. If you desire to forecast performance for next year, the best forecast will be given by the ________.

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

Geometric Average Return

The compounded annual rate of return over time, accounting for the compounding of investment returns.

Arithmetic Average Return

A method of calculating the average return of an investment by simply dividing the sum of all returns by the number of periods.

Dollar-Weighted Return

An investment's return that takes into account the timing and amount of capital inflows and outflows, reflecting the investor's actual experienced rate of return.