This could provide some room for downward adjustment in nominal returns
to cater to broad macroeconomic considerations despite external account concerns.
Based on M&A related expectations, Yapi Kredi Sigorta posted 33% and 82% nominal returns
within the last three and 12 months, respectively, and outperformed the ISE-100 by 25% and 35%, respectively, in the aforementioned periods.
Bodie (1976) worked on Fisher Hypothesis and found that actual nominal return
depends on expected and unexpected inflation rates and also it depends on expected and unexpected nominal returns
The policy of quantitative easing, designed to stimulate consumption, has an impact on savers - who face negative real returns - or even sometimes, negative nominal returns
More precisely, a 30-70 basis point reduction in annual expected returns over a ten-year period in an environment of, say, 8 percent average nominal returns
means a terminal wealth that is five to thirteen percentage points lower than would have been otherwise realized.
The five panels of Figure 2 show the cumulative frequency distributions over the tightening and easing policy stances for nominal short- and long-term yields and the 1-year realized nominal returns
on long-term Treasuries, the S&P 500 Composite equity index, and home prices.
For the markets themselves, it is not so much the increase in consumption prices that is the problem, but rather the reactions that it triggers in terms of increases in the nominal returns
demanded by investors.
This means that nominal returns
that appear to be 9 percent, in truth can become 2 percent or less.
It may be bad for borrowers but it would benefit many savers who have had a very raw deal with nominal returns
It is clear from Table 3 that taxes matter a lot for portfolio composition with the implication that research based on nominal returns
and, to some extent Fisher real returns, can be very misleading by ignoring the level effect of taxation.
Cash ISA: Although this gives "tax free" growth, the minimal nominal returns
leaves your cash vulnerable to inflation, given that interest rates barely keep up with inflation at the best of times.
The 'Tax Effect' Nominal Returns
Total Return Volatility Lehman Municipal Bond: 7-Year 4.