RISK ADJUSTED RETURN Definition

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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.

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MAINTENANCE is the activity involved in maintaining something in good working order. May include replacement of significant portions of the item(s) being maintained.

ASSESSED VALUE is the estimated value of property used for tax purposes.

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