Knowledge Tree
investment return
Also known as: investment return, investment returns
Facts (16)
Sources
Chapter 8 – Risk and Return – Fundamentals of Finance pressbooks.pub 4 facts
claimStandard deviation measures the variability or volatility of investment returns relative to the expected return, which quantifies the investment's risk.
measurementA hypothetical stock with a 20% probability of a -10% return (recession), a 50% probability of a 5% return (stable growth), and a 30% probability of a 15% return (boom) serves as an example of a probability distribution for investment returns.
claimA higher standard deviation in investment returns indicates that the returns are more spread out, which signifies greater investment risk.
procedureThe procedure to calculate the standard deviation of investment returns (σ) involves five steps: (1) subtract the expected return from each possible return to find the deviation for each outcome, (2) square each deviation, (3) multiply each squared deviation by the probability of its corresponding outcome, (4) sum all the weighted squared deviations, and (5) take the square root of the result.
An Exploratory Study of the Wealthy's Investment Beliefs ... financialplanningassociation.org Mar 1, 2025 2 facts
referenceNatixis published a press release titled 'Individual Investors Still Expect Double Digit Investment Returns Despite New Market Environment' on June 21, 2023.
claimThree-quarters of the younger cohort of high-net-worth individuals believe it is no longer possible to achieve above-average returns using only traditional stocks and bonds.
The Relationship Between Risk and Return in Different Asset Classes bi-sam.com Mar 18, 2025 2 facts
claimInvestment returns are typically expressed as percentages and can be measured as absolute returns (the simple rate of return) or relative returns (performance compared to a benchmark).
claimInvestment return is defined as the gain or loss generated on an investment relative to the amount invested.
Systemic or “Macro” Factors that Affect Financial Thinking nicoletcollege.pressbooks.pub 1 fact
claimDuring periods of economic contraction, the usefulness and value of capital may decline, and overall investment returns may suffer.
Taxes, Government Transfers and Wealth Inequality milkenreview.org Jan 21, 2019 1 fact
claimWealthy individuals typically accumulate wealth by saving a larger-than-average share of their income and achieving investment returns significantly higher than the 6-7% average real rate of return for typical stock investors.
Next Generation Investment Risk Management: Putting the 'Modern ... financialplanningassociation.org 1 fact
claimShortfall probability is defined as the probability that an investment return will fall below a specific, user-defined target.
1.3: Systemic or "Macro" Factors That Affect Financial Thinking biz.libretexts.org Aug 23, 2025 1 fact
claimUnstable currency values make investment returns more difficult to predict and increase the risk associated with investments.
Economic Indicators Every Investor Should Know | FMP site.financialmodelingprep.com May 30, 2024 1 fact
claimHigh inflation, as measured by the Consumer Price Index (CPI), can erode purchasing power and affect investment returns, while low inflation can indicate stable economic conditions.
The Evolution of Tariffs: The United States' Historical Implementation ... thefinplangroup.com Oct 22, 2025 1 fact
claimPeriods that followed investors cashing out of the market have provided above-average returns, while periods that followed investors adding to the market have provided below-average returns.
Twelve Principles of Personal Financial Literacy (Rutgers NJAES) njaes.rutgers.edu 1 fact
claimIndividuals should be skeptical of financial offers that promise free items or guaranteed investment returns, as these are often 'too good to be true.'
Key Macroeconomic Indicators Every Investor Should Track rosenbergresearch.com May 19, 2025 1 fact
claimInflation influences real investment returns and reduces the purchasing power of money as prices rise, causing future income or capital gains to hold less real value.