Inflation-Adjusted Rate of Return
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Removing the effects of inflation from the return of an investment allows our clients to see the true purchasing potential of our investment selections, without external economic forces. For example, say our firm chooses to hold a bond that returned 4% over one year. Examining only the return shows that this bond earned a positive income. However, if inflation for the year was 5%, the real rate of return on the bond becomes -1%. Our firm actually lost our client spending power.
That is why our firm benchmarks against inflation rate. Our firm focuses on increasing purchasing power, not keeping up or beating the market indices.