Real rate
From ACT Wiki
A rate which has been restated to exclude the effects of inflation.
The relationship between the Real rate, the Nominal rate and the Inflation rate is: Real rate = ([1 + Nominal rate]/[1 + Inflation rate]) - 1
For example if the Nominal rate of return = 6% (0.06) and the Inflation rate = 3% (0.03), then the Real rate of return = 1.06/1.03 - 1 = 0.0291 = 2.91%.
See also
