Sentences with phrase «portfolio equals the rate»

The CAPM model says that the expected return of a security or a portfolio equals the rate on a risk - free security plus a risk premium.

Not exact matches

(In other words, all things being equal, a portfolio packed with two - year Treasuries will lose less as rates move up than one loaded with 10 - year notes.)

Translated from math - speak to English, we're more or less saying, «the monthly returns of the bond portfolio is equal to some multiple of rate changes plus some multiple of credit spread changes.»

In general, bond prices are inversely correlated with market interest rates — so if I'm holding a bond portfolio and market interest rates go up, then my portfolio will decrease in value assuming all else is held equal.

With the 50 % stock portfolio, the Historical Surviving Withdrawal Rate (HSWR50) equation is HSWR50 = 0.3979 x +2.6434 %, where x = 100 * (E10 / P) or 100 / [P / E10] = the earnings yield in percent and R squared equals 0.6975.

At the Calculated Rate, the lowest portfolio balance equals (or exceeds minimally) one - half of the initial balance in throughout the entire 30 years.

The resulting rates of return aren't from taking averages, it's from allocating equal amounts from the different asset classes into one portfolio, then rebalancing it on a regular basis, usually once or twice a year.

If your nest egg upon retirement is equal to 12 times that income, or $ 1.2 million, you could reasonably withdraw $ 48,000 in the first year of retirement, assuming a 4 % portfolio withdrawal rate.

Some people use leverage, borrowing money at a low rate, to be able to buy a larger amount of a low - risk portfolio, making its beta equal to that of the index.

The difference in the portfolios» growth rates (slope) equals the 4.2 % return from dividends (= 10.2 % - 6 %).

For nearly every target rate of return, a diversified portfolio of minimally - correlated investments can be constructed that will be lower risk than one investment with equal expected return.

No matter whether you prefer no dividends, some dividends, or large dividends, as long as you presume the dividend growth rate equals the stock price's growth (by extension the growth in earnings), you always end up with a portfolio of equal size.

After a few years, the portfolio's total return first equals the return it would have received if rates were unchanged — then surpasses that rate.

If we assume that the risk - free rate is a 3 - month US Treasury (10 - year US Treasury is also common) and equal to 1.50 %, the portfolio beta is 1.60 (60 % more systematic risk or volatility than the benchmark), the benchmark has returned 10 % annualized, and the portfolio return is 20 %, we have:

The equal - weight reference portfolio's annualized rate of return over the 49 - year measurement period outpaced the cap - weighted benchmark return by 1.80 %.

Also called the internal rate of return, the interest rate will make the present value of the cash flows from all the sub-periods in the evaluation period plus the terminal market value of the portfolio equal to the initial market value of the portfolio.

Each year, one should spend (at most) the amount that a freshly purchased annuity — with a purchase price equal to the then - current portfolio value and priced at current interest rates and number of years of required cash flows remaining — would pay...