In the present study we asked people to estimate the actual rates of return
from investment in housing, shares and term deposits over the previous ten years.
We identify the following major factors which explain the deviation of actual rates of return on RAB from the statutory rates.
We estimate that tariff smoothing, the occurrence of missed income and its corresponding compensation are the major reasons for the deviation of actual rates of return on RAB from the statutory rates established by the regulator.
The efficiency of the constructed portfolios is evaluated in terms of Treynor, Sharpe, and Jansen coefficients as well as employing expected and actual rates of return
Actual rates of return
for insurers remain below the promised payout rates set in better times -- when interest rates were much higher.
Unfortunately, actual rates of return
are hard to obtain because they depend on estimates of training costs and benefits.
Then we'd expect that if we compared that rate to the actual rates of return
on a high-quality fixed-income portfolio, the fixed-income return would be lower in most years, although it might be higher in others.