You dream. You envision. You hope. You believe that your fidget spinner company will return a million bucks in profit next year, four million the year after that, and ten million the year after that. You honestly expect those financial returns.
Three years go by, during which you visually age forty years, only to look back and realize that your trailing three years actual returns were breakeven year one, a loss of $200,000 year two, and a loss of a million in year three, before you finally threw in the towel and declared bankruptcy.
In wars, actual always defeats expected. Sorry.
Related or Semi-related Video
Finance: What Is a Real Return?67 Views
finance- a la shmoop. what is a real return? like is there a fake return? you
know like the news? well kinda .real return refers to an [man frowns talking to camera]
investment return mapped against inflation. so let's say you invest in a
bond that pays five percent a year for ten years and then pays you back your
principal .boring but nice- you know like a good doctor visit. your nominal return
over that period was 5% but since inflation was 3% a year during that
period on average your real return was only 2% a year- meaning that the
performance of your investment only eked out a 2% net gain against the price of [equation]
milk gas and you know knocked off iPhones. so don't be a chump who thinks
that they're making more money than they really are, and you know keep on keeping
it real. [man sitting in chair, talks to camera]
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