Risk-free asset: Difference between revisions
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* [[Interest rate risk]] | * [[Interest rate risk]] | ||
* [[Investment management]] | * [[Investment management]] | ||
* [[Market risk premium]] | * [[Market risk premium]] | ||
* [[Portfolio]] | * [[Portfolio]] | ||
Latest revision as of 07:39, 5 October 2024
Investment management - risk appetite - flight to quality - rates of return - risk-free rate of return - risk assets.
For practical investment management and portfolio management purposes, a risk-free asset is considered to be one on which the expected rate of investment return is so likely to be achieved, that it can be treated as near-enough risk free for the purpose.
The usual example is short-dated debt obligations of a low-risk domestic central government.
For example in the United States, short-dated obligations of the US Treasury.
In this context, all assets that are not risk-free assets, are classed as risk assets.
The exact boundary between risk assets and risk-free assets can vary, depending on the purpose of the classification.
