   
|
|
|
|
Real Rate Of Return
|
The real rate of return is the rate of return on an investment after taking inflation into account. The nominal rate of return (ignoring inflation) is higher than the real rate of return if inflation is positive. The higher the level of inflation, the larger the difference between the real rate of return and the nominal rate of return. The longer the period of the rate of return, the more important it is to consider the real rate of return. The real rate of return is zero if the nominal rate of return matches inflation. The real rate of return is negative if the nominal rate of return is less than the rate of inflation. Unless inflation is very high, the real rate of return will be very close to the nominal rate of return over short periods.
Rate this real rate of return definition...
|
|
Where is the market headed? The answer may surprise you. Find out
right now with the exclusive & Barron's recommended charts of Chart of the Day.
|
Popular Terms: EBITDA, liquidity ratio, 401a, deferred tax, command economy, 144a, per diem, margin rate, deferred revenue, required rate of return, cancelled check, open position, stock split, ex-dividend, implied volatility, in escrow, irrevocable trust, limit order, quality assurance, risk management, 1035 exchange, Key Rate Duration, class C shares, current ratio, Zero Cost Collar, 1031 exchange, wholly-owned subsidiary, VIX, reverse mortgage, retained earnings, phantom income, option premium, minority interest, labor relations, ex-dividend date, covered put, real GDP, LIBOR, inflation, dividends payable, diluted share, debt service coverage, balance sheet, APR, equities, average price per share, FICO score, FTSE, stock market close
|
|
|
|
