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For comparisons of the risk/return ratio of an investment, one must start with a benchmark of a risk-free rate of return in the current market.
Since U.S. Treasury bills are backed by the full faith, credit, and taxing power of the U.S. Government, they are considered “riskless,” or as close to riskless as we can get. The current yield on a 10-year Treasury note is generally considered the risk-free rate of return.
This number becomes part of calculations which attempt to find an appropriate price for the amount risk and return present in other financial instruments. Any amount of risk above the risk-free rate amount is subject to the expectation of a “risk premium,” which exists for both debt and equity instruments.
In the case of debt/bonds, the yield on a bond must be compared with the current rate of the risk-free treasury note. In the case of equities, the risk premium will be the amount of return that will make it worth the investor’s “while” to take on the amount of risk present.
How Do I Measure My Risk Tolerance?
What are Risk-Weighted Assets?
Realistically, you should not plan on getting more that about 10% average per year over the long term for a portfolio...
Real estate investments fall into a wide spectrum of subsets. You can invest in residential property, commercial, etc.
403(b) contribution limits are currently the same as 401(k) limits, and are adjusted for inflation at the same rate
An accounting convention is an established an agreed-upon method of documenting specific items on a company’s books
Account Number — Financial Definition
Earnings is another word for the net income of a company. It is one of the most important numbers in corporate finance
An income statement is a business’s financial statement that gives the income results from operations and non-operations
The Three Falling Peaks pattern forms when three minor Highs arrange along a downward-sloping trend line
Litecoin is very similar to bitcoin, but there are some distinct differences
Tokenization is a concept that can take several forms, but essentially it means to create a tradeable item which holds value anchored in an asset