Getquin has finally added the IZF value, but what exactly does this mean for a depot?
Briefly about myself:
I am a small investor with a savings rate of 500 euros, about 50-50 divided between shares and etfs. I cannot make short-term speculative investments for high returns, my focus is primarily on long-term stability and then, of course, growth. I hold high dividend stocks (more than 5% dividend) as well as typical growth stocks. My annual allowance is exhausted by dividends, which are reinvested in savings plans and premium subscriptions such as Getquin. ^^
The benefit of the IZF value
The pure growth rate indicates the added value in the portfolio, but not whether it has been traded well: this is where the IZF value comes into play.
The IZF (IRR) - internal rate of return indicates the effective annual return on total capital (comparable to an overnight interest rate) and measures how good the real timing and cash flow management were in the year.
In contrast, the TTWROR which measures the time-weighted
investment strategy performance i.e. the (growth) quality of the security selection.
Are high IZF and TTWROR values good?
On their own - yes.
A direct comparison of these two values would be better.
General statements:
- TTWROR > IZF
Security selection is/was good, but contributions came late or in uneven buying phases. Less capital benefited from early growth. Stocks performed strongly, but capital came in too lateto capture the full performance.
- TTWROR < IZF
Early (cheap) investment, but only moderate growth.
In the overall view of the portfolio, the IZF value is annualized, i.e. averaged over the investment year. The TTWROR, on the other hand, is NOT; it refers to all investment years.
Investment efficiency
If you want to know the actual efficiency level of your investments (overall view), you need to average the TTWROR value, i.e. divide it by the number of years invested.
OR:
The IZF/TTWROR values per calendar year are consistent. The figures can be used directly.
Methods of measurement.
A) Efficiency ratio
A particularly intuitive metric is easy to determine:
Efficiency = (IZF/TTWROR)*100
Example from my portfolio in calendar year 2025
Effizienz=(14,3/11,5)×100
- IZF = 14.3% p.a.
- TTWROR = 11.5 % p. a.
- → Efficiency = 122.87 % (22,87%)
General interpretation:
- ≈ 100 %: Capital utilization optimal (no timing effect)
- < 100 %: Capital arrived too late (TTWROR > IZF)
- > 100 %: Very good timing (IZF > TTWROR)
Statement: Timing of capital flows. With the value 22,87% I have achieved a higher return than my pure market performance of 11.5% TTWROR.
Method 2
B) The delta chart.
Here an approximation between IZF and TTWROR is created.
The DELTA shows how strongly the money-weighted yield (IZF) from the time-weighted performance (TTWROR) and how optimally you are working.
Information content: indicates the "timing added value" or "cash flow spread", i.e. the additional return on specific capital investments (deposits at lows, reallocations e.g. loss-making sales to high-yielding shares, profit-taking)
Formula:
DELTA = IZF-TTWROR
Concrete example:
IZF: 14.3 % p. a.
TTWROR :11.5 % p. a. (averaged)
In my case: IZF - TTWROR = 2.63 %
General conclusion:
- < -1 %
Capital came too late → Potential wasted,
Optimizable
- 0-1%
Stable actions, but hardly any changes
>Optimizable
- 1-2 %
Neutral to good timing
Very solid
- 2-3%
Above average timing
Strong, but rarely durable
>3%
Extremely good, usually associated with high volatility
Mostly through trading or short-active actions
SUPPLEMENT:
If IZF and TTWROR go into the hundreds (as over 100%) - then you guys are the hottest ^^ - but the rating of efficiency and DELTA does not change in mathematical logic.
Efficiency logic (Assumption 100% is existing market performance)
- TOP: everything above 100%, excellent market timing
- Neutral; anything approaching 100%,
- Meh: logical, less than 100% means bad timing without influence on your portfolio performance (for the moment)
Note Bad timing here does not mean that the investment is bad, but only that the purchase takes longer to go above 100%.
Delta logic (timing difference)
Reminder: The VALUE from IZF-TTWROR is the timing "return", i.e. the value that shows you whether your time-weighted purchase had an impact on the growth of the specific share.
Here too
- Over 100% - extremely strong
- Close to 100% - no timing effect, purely market-driven
- Below 100% : logically how much loss of return the purchase has cost you (e.g. buying at ATH, chasing a daily trend)
Cautionetfs and very short-term trades dilute the valuation, IZF and TTWROR both calculations are averaged over 1 year.
Anyone who has made 500% return with one trading activity has beaten the market 5 times etc.
It would be mathematically logical to use leverage factors for values above 100%.
