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excess Return
noun
An excess return is the return that exceeds the risk-free return.
Exact(60)
"They're looking into how to generate excess return".
But this performance is significantly less than the 14.5% excess return that previous studies had found.
The excess return measures how attractive stock investments are compared with completely safe investments like short-term T-bills.
For large caps, the average excess return was 10percentt under Democrats and 2percentt under Republicans.
The two firms say it is the volatility of tracking difference (or excess return) over time, which they calculate as the standard deviation of tracking difference or excess return.
As Munnell says, "You have to put aside the excess return you earn in good times to cover your costs when the bad times hit".
To be sure, much of the excess return occurs shortly after an activist announces his or her intention to battle for board seats at a company.
The volatility of the momentum index was rather higher but the Sharpe Ratio (excess return divided by volatility) was still better than the Russell index.
The quants are showing that when such managers did outperform, the excess return was driven by factors that can be identified and commoditised.
It calculates the excess return earned over the risk-free rate when taking the volatility of the relevant assets' prices into account.
That excess return is known as the "equity risk premium .Experience during the second half of the 20th century seemed to bear out the theory.
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