You have brought up an important point.
The returns can be calculated in two ways (i.e)
Time-weighted (TWRR) and
Money-weighted rates of return (MWRR)
“The main difference between TWRR and MWRR are the effects of cash flow. As we discussed earlier, TWRR does not take cash flow into consideration, while MWRR does take cash flow into consideration when calculating your rate of return. “
Source : Comparing Time-Weighted Versus Money-Weighted Rates of Return | CIBC
Book reco : Investment Performance Measurement: 105 (Frank J. Fabozzi Series)
Hope this is of help !
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