Required Rate of Return Calculator

Required Rate of Return Calculator

Required Rate of Return Calculator

Required Rate of Return:

Formula: Required Rate of Return = (Net Cash Flow / Investment Amount) × 100

Required Rate of Return Calculator
Parameter Description Example Value
Risk-Free Rate (Rf) The return on a risk-free investment, such as government bonds. 2%
Beta (β) The measure of a stock’s volatility relative to the market. 1.2
Market Return (Rm) The expected return of the market. 8%
Required Rate of Return (RRR) The minimum return an investor expects to achieve on an investment.
Formula: Rf + β(Rm – Rf)
9.2%

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