Definitions for "Excess return"
Related Terms:
Risk-adjusted return, Holding period return, Expected return, Absolute return, Equity risk premium, Capital asset pricing model, Growth assets, Risk-free asset, Rona, Required rate of return, Efficient portfolio, Roa, Return on total assets, Roi, Efficient frontier, Return on invested capital, Total return, Risk adjusted return, Annualized return, Underperform, Risk-free rate of return, Investment return, Raroc, Sharpe ratio, Risk premium, Roic, Roe, Average rate of return, Average annual total return, Capm, Performance, Returns, Capital market line, Investment risk, Cash-on-cash return, Time-weighted rate of return, Return on equity, Opportunity cost of capital, Return, Rate of return, Accounting rate of return, Risk adjusted return on capital, Cumulative return, Return on assets, Return on investment, Total asset turnover, Return on capital, Alpha, Hurdle rate, Real return
The amount by which the return on an investment is greater than the risk free rate of return.... more on: Excess return
return relative to the risk free return. If an asset return is 3% and the risk free return is 0.5%, then the asset's excess return is 2.5
Any return over the return produced by cash.
In CAPM, an investment performance that exceeds the predicted return, i.e., the risk free rate + the equity risk premium.
The return achieved by a security over and above that obtained from a risk-free asset (such as a short-term government bond) held over the same period.
Return relative to the risk-free return. If an asset return is 10% and the risk-free return is 5%, then the asset's excess return is 5%. The benchmark's return can be substituted for the risk-free return.
The difference between the returns of two portfolios. Usually excess return is the difference between a manager's return and the return of a benchmark for that manager.
The return on a security which exceeds that obtained from a risk-free asset (such as a short-term government bond) held over the same interval.
The return derived from a security (during a specified holding period) less the return from holding a riskless security (such as a short-term government obligation) during the same period.