Measuring and managing returns

Timothy A. Krause, Eric J. Robbins and Santina A. Haddad

Chapter 3 in Understanding Investment Risk and Return, 2025, pp 42-65 from Edward Elgar Publishing

Abstract: This chapter explores the many ways to measure and manage returns. Individual investors can measure returns at a point in time or over multiple holding periods. It is good practice to consider returns after adjusting for inflation and the costs associated with the strategy. It is also important to include all sources of return, including capital appreciation and income (e.g., dividends or interest) received. Bond investors are concerned with income and capital appreciation (or lack of depreciation), but there are other nuances. These return factors include the coupon rate and relevant yield metrics like current yield, yield-to-maturity, yield-to-call, and yield-to-worst. Investors can consider earnings-based return measurements that can potentially drive returns in financial markets. These include measurements like return on assets, return on equity, and return on invested capital.

Keywords: Capital appreciation; Dividends; Yield to maturity; Current yield; Return on assets; Return on equity (search for similar items in EconPapers)
Date: 2025
ISBN: 9781035339716
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.elgaronline.com/doi/10.4337/9781035339723.00013 (application/pdf)
Our link check indicates that this URL is bad, the error code is: 403 Forbidden

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:elg:eechap:23600_3

Ordering information: This item can be ordered from
http://www.e-elgar.com

Access Statistics for this chapter

More chapters in Chapters from Edward Elgar Publishing
Bibliographic data for series maintained by Jack Sweeney ().