Internal rate of return (IRR)

Definition:

Dollar-weighted rate of return. Discount rate at which net present value (NPV) of an investment is zero. The rate at which a bond's future cash flows, discounted back to today, equal its price.

Investing Essentials


Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

Term of the Day

Presidential election cycle theory

A theory that stock market trends can be predicted and explained by the four-year presidential election cycle.

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