Real Risk-Free Rate of Return(redirected from Real Risk Free Rate of Return)
Real Risk-Free Rate of Return
The risk-free rate of return after taking inflation into account. For example, if the risk-free rate of return is 3% and the inflation rate is 2%, the real risk-free rate of return is 1%. Because the risk-free rate is low in the first place, the real return can sometimes be negative, particularly in times of high inflation.
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