Certainty equivalent

An amount that would be accepted in lieu of a chance at a possible higher, but uncertain, amount. The New York Times Financial Glossary

Financial and business terms. 2012.

Look at other dictionaries:

  • Certainty Equivalent — A guaranteed return that someone would accept, rather than taking a chance on a higher, but uncertain, return. If you ve ever thought about leaving your job to start your own business, and potentially make more money, but decided to stay and… …   Investment dictionary

  • certainty equivalent — An amount that would be accepted today (risk free) in lieu of a chance to receive a possibly higher, but uncertain, amount. Bloomberg Financial Dictionary …   Financial and business terms

  • certainty equivalent method — In capital budgeting, a method of risk analysis in which a particularly risky return is expressed in terms of the risk free rate of return that would be its equivalent …   Accounting dictionary

  • certainty equivalent method — In capital budgeting, a method of risk analysis in which a particularly risky return is expressed in terms of the risk free rate of return that would be its equivalent …   Big dictionary of business and management

  • certainty equivalent method — Fin an approach to dealing with risk in a capital budgeting context. It involves expressing risky future cash flows in terms of the certain cash flow which would be considered, by the decision maker, as their equivalent …   The ultimate business dictionary

  • Certainty Equivalent Return — 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%.… …   Financial and business terms

  • certainty — certainty, certitude, assurance, conviction are comparable when denoting a state of mind in which one is free from doubt. Certainty and certitude both imply the absence of all doubt as to the truth of something; they are not always… …   New Dictionary of Synonyms

  • proof to a moral certainty — The equivalent of proof beyond a reasonable doubt, signifying such proof as satisfies the judgment and conscience of the jury, as reasonable men, that the defendant is guilty of the crime charged. 30 Am J2d Ev § 1171 …   Ballentine's law dictionary

  • Эквивалентная безрисковая доходность — (CERTAINTY EQUIVALENT RETURN) доходность по безрисковому вложению, при котором это вложение имеет для инвестора такую же привлекательность, как и рассматриваемая рисковая инвестиция …   Финансовый глоссарий

  • Risk aversion — is a concept in psychology, economics, and finance, based on the behavior of humans (especially consumers and investors) while exposed to uncertainty. Risk aversion is the reluctance of a person to accept a bargain with an uncertain payoff rather …   Wikipedia

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