RAROC. A financial measurement that allows analysts to take into account the effect of risk when comparing profitability and performance across various businesses. It is calculated by dividing the risk adjusted return (net income - expected loss from risk + income from capital) by the economic capital. Higher risk projects tend to bring higher rewards.

Related information about risk adjusted return on capital (RAROC):

1. Risk-adjusted return on capital - Wikipedia, the free encyclopedia
   Risk-adjusted return on capital (RAROC) is a risk-based profitability measurement framework for analysing risk-adjusted financial performance and providing a ...
    
2. Risk-Adjusted Return On Capital (RAROC) Definition | Investopedia
   An adjustment to the return on an investment that accounts for the element of risk. Risk-adjusted return on capital (RAROC) gives decision makers the ability to ...
    
3. Jeff For Banks: Risk Adjusted Return on Capital (RAROC) for ...
   May 8, 2012 ... Risk Adjusted Return on Capital (RAROC) for Financial Institutions. How do you measure the profitability of lines of business, products, ...
    
4. Practical Application of the Risk-Adjusted Return on Capital ...
   This paper applies a risk-adjusted return on capital (RAROC) framework to the financial analysis of the risk and performance of an insurance company. A case ...
    
5. What is risk adjusted return on capital (RAROC)? - InvestorWords.com
   Definition of risk adjusted return on capital (RAROC): RAROC. A financial measurement that allows analysts to take into account the effect of risk when ...
    
6. Pricing & Risk using RAROC- Risk Adjusted Return On Capital ...
   May 24, 2009 ... What Does Risk-Adjusted Return On Capital - RAROC Mean? An adjustment to the return on an investment that accounts for the element of risk ...
    
7. risk-adjusted return on capital (RAROC) - Insurance Glossary
   risk-adjusted return on capital (RAROC) - A target return on equity (ROE) measure in which the numerator is reduced depending on the risk associated with the ...
    
8. risk adjusted return on capital,RAROC
   risk adjusted return on capital,RAROC formula,equation,calculator. RAROC, risk adjusted return on capital,RAROC. ER, expected return,ER. VaR, value at risk, ...