Since equation (1) holds for any positive integer n, Equation (3) must hold for any number of assets as well once the expected rate of return
and their covariance existent or being given.
Remember: the required rate of return
on an investment reflects the degree of risk of the investment.
Some investors are, in fact, willing to make investments at less than our willing investor criterion; that is, at some probability of achieving a greater than inflation rate of return
less than 84% of the time.
Pre-tax profits as a rate of return
on total sales among furniture manufacturers exceeded the same ratio among manufacturers in general in 1999, 2001 and 2002.
45% of the time, the stock's rate of return
will be higher than the 7.
For the market-value measure, the average rate of return
for USDIA was about 8 percent, compared with 3 percent for FDIUS.
This makes the taxable equivalent rate of return
more attractive than the nominal annual percentage yield (APY) of the investment.
Use a special calculator or the standard Excel IRR function to take iterative guesses for internal rate of return
until the equation results in zero (or close enough).
6 million in interest earnings, the city's rate of return
stood at 6.
Thus the opportunity cost of the prepayment should be computed using the anticipated rate of return
on taxable assets, which is, of course, almost invariably lower than the rate of return
on sheltered assets (because of capital gains taxes).
10 /PRNewswire/ -- The Principal Financial Group, the nation's leading 401(k) provider by number of plans, has introduced Personalized Rate of Return
, an online program giving plan participants a more comprehensive picture of their personal investment performance.
We have a rate of return
base for every venture we invest in.