Riskless rate

Riskless rate

Riskless rate

The rate earned on a riskless investment, typically the rate earned on the 90-day U.S. Treasury Bill.

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Riskless or risk-free asset

Riskless or risk-free asset

Riskless or risk-free asset

An asset whose future return is known today with certainty. The risk free asset is commonly defined as short-term obligations of the U.S. government.

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Risk-adjusted return

Risk-adjusted return

Risk-adjusted return

Return earned on an asset normalized for the amount of risk associated with that asset.

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Risk premium approach

Risk premium approach

Risk premium approach

The most common approach for tactical asset allocation to determine the relative valuation of asset classes based on expected returns.

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Risk premium

Risk premium

Risk premium

The reward for holding the risky market portfolio rather than the risk-free asset. The spread between Treasury and non-Treasury bonds of comparable maturity.

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