RISK ADJUSTED RETURN is when we subtract from the rate of return on an asset a rate of return from another asset that has similar risk. This gives an abnormal rate of return that shows how the asset performed over and above a benchmark asset with the same risk. We can also use the beta against the benchmark to calculate an alpha which is also risk adjusted performance.
BEST EXECUTION is NASD Rule 2320 The obligation of Market Makers, broker/dealers, and others to execute customer orders at the best price available at the time the trade is entered.
RESPONSIBILITY CENTER is a subunit in an organization whose manager is held accountable for specified financial results of its activities.
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