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Investing Glossary:
Certainty Equivalent Return
Copyright 2009,
Campbell R. Harvey. All Rights Reserved.
Do not reproduce without explicit permission.
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| Term: |
| Certainty Equivalent Return
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| Definition: |
| The certain (zero risk) Return an Investor would Trade for a given (larger) return with an associated risk. For example, a particular investor might trade an uncertain expected 4% Active return with 6% risk, for a certain Active Return of 1.5%.
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