Residual Return

Residual Return

Return independent of the benchmark. The residual return is the return relative to beta times the benchmark return. To be exact, an asset's residual return equals its excess return minus beta times the benchmark excess return.

Residual Return

A return on an investment that is independent of the investment's benchmark. It is calculated as follows:

Residual return = Excess return - (Benchmark's excess return * beta).
References in periodicals archive ?
If the company's hurdle rate is higher than the return on equity, it will have negative residual return.
Any material clinging to the cable and disc assembly can be continually removed during operation by the stiff bristles of a brush box or by a residual return chute equipped with a disc ramp that dislodges material and returns it to the product stream.
Proprietary economization software virtually eliminates liquid cylinder vent loss and substantially reduces residual return. Switching is actuated as inlet pressure falls below a user-defined point by means of a web interface or a serial port.
estate is reduced to a 0% residual return by the incurrence of 10%
Series 642's integral Web server enables remote access, integrated Ethernet connectivity provides for seamless network integration, e-mail notification allows for 24/7 system monitoring, and Low-Loss technology reduces residual return, while an electronic economizer eliminates liquid can vent loss, a NEMA-4 cabinet allows for simple installation, and an internal-balance stem-line regulator ensures total process control.
where [[??].sub.it] is the residual return for country i after estimating Equation (150) on daily excess returns as shown in Table 4 (that is, after controlling for systematic risk).
The three year residual return for firms filing after the 1978 Bankruptcy Reform Act was not statistically different from zero, with approximately half of the securities having price increases and half of the securities having price decreases.
For this reason, its total annual cost of capital is represented by the residual return to capital (the residual of total operating revenue after subtracting costs of labor and material inputs).
If expectational rate of return models do not eliminate residual return commonalities, the assumption that observations are independent will be violated.
Equation (1) says that an initial franchisee with an exclusive territorial guarantee receives for certain the residual return from a single retail outlet plus half of the incremental profits from installing a second retailer when doing so is profit maximizing.
The average residual return on the completion date is just over 2%.
Traditional capital market approaches use cross-sectional approximations of mean abnormal returns and standard errors, and hence, characterize the economic significance of a single firm's residual return in terms of sample-wide rather than firm-specific residual return variability.