Risk-Free Rate Of Return

The principle that potential return rises with an increase in risk. Low levels of uncertainty (low risk) are associated with low potential returns, whereas high levels of uncertainty ...

A concept that refines an investment's return by measuring how much risk is involved in producing that return, which is generally expressed as a number or rating. Risk-adjusted returns ...

The excess return that an individual stock or the overall stock market provides over a risk-free rate. This excess return compensates investors for taking on the relatively higher risk ...

An phenomenon that describes the anomalously higher historical real returns of stocks over government bonds. The equity premium, which is defined as equity returns less bond returns, has ...

A mutual fund or exchange-traded fund that seeks to replicate a broad bond index by owning many securities across a range of maturities, from both public and private sectors. The most ...

A rate of return used in financial analysis, whereby riskier projects and investments are evaluated based on the capital at risk. RORAC makes it easier to compare and contrast projects ...

The amount of money generated by an investment before expenses such as taxes, investment fees and inflation are factored in. For example, detailed data on a mutual might show a fund's ...

The level of risk you take on is positively correlated to your potential returns. Read more here.

This simple ratio will tell you how much that extra return is really worth.

Understanding interest rates helps you answer the fundamental question of where to put your money.

The consumption capital asset pricing model smoothes over some of CAPM's weaknesses to make sense of risk aversion.

The required rate of return is used by investors and corporations to evaluate investments. Find out how to calculate it.

Learn how to follow the efficient frontier to increase your chances of successful investing.

Find out your acceptable level of risk versus reward.