Risk-adjusted return

Often 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.


Do you need a Financial Planner?

Click here to get matched to financial planners near you. Free service.

Get Started Now



Here are 10 random terms from our database: