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| (Rf).
| | == Summary == |
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| The theoretical rate of investment returns which can be earned on hypothetical investments which are considered to be risk-free for modelling purposes.
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| The Capital asset pricing model (CAPM) incorporates this type of risk-free rate.
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| Historically, the rates of return on certain types of domestic central government debt were considered to be a close enough proxy for such hypothetical risk-free investments.
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| In the modern era, domestic central government debt is no longer considered to be risk-free for this purpose, nor for a number of other purposes for which it was historically considered to be risk-free.
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| ====Interest rate benchmarks====
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| The term 'risk-free rates' (RFRs) is also used in the context of interest rate benchmark rates.
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| For example, risk-free rates that might be used as alternatives to LIBOR.
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| == See also == | |
| * [[Benchmark]]
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| * [[Capital asset pricing model]]
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| * [[Credit spread ]]
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| * [[Gilts]]
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| * [[Interest rate risk]]
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| * [[LIBOR]]
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| * [[RFR]]
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| * [[Risk-free rates]]
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| [[Category:Corporate_financial_management]]
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Latest revision as of 09:29, 27 July 2023
Summary
Importing files from local file repository
