




The rate of return is the percentage gain or loss of an investment over a period of time. Rate of return is often expressed as an annual percentage; for example, an annual rate of return of 5 percent means the investment gained 5 percent over a twelve month period.
The rate of return is based on the change in value of the underlying asset, adjusted for payouts. A bond, for example, has a rate of return equal to the total interest paid by the bond adjusted for changes in price of the bond itself. The rate of return of a stock is the change in price adjusted for any dividends. With mutual funds and other pooled investments, the rate of return must also account for any capital distributions.
Rate this rate of return definition...




Where is the market headed? The answer may surprise you. Find out with the exclusive & Barron's recommended charts of Chart of the Day. 

Popular Terms: real GDP, per diem, APR, open position, exdividend date, current ratio, VIX, Zero Cost Collar, reverse mortgage, option premium, LIBOR, 1031 exchange, risk management, phantom income, cancelled check, FICO score, command economy, whollyowned subsidiary, dividends payable, EBITDA, stock market close, balance sheet, deferred revenue, minority interest, irrevocable trust, deferred tax, required rate of return, 144a, FTSE, in escrow, limit order, stock split, implied volatility, debt service coverage, annual return, labor relations, quality assurance, exdividend, average price per share, inflation, 401a, 1035 exchange, class C shares, diluted share, margin rate, Key Rate Duration, retained earnings, liquidity ratio, covered put


 