Portfolio Rate Of Return
What Does Portfolio Rate Of Return Mean?
A portfolio rate of return refers to the amount of money earned or lost on an investment portfolio over a specific period, expressed as a percentage.
Many life insurance policies include an investment component. The investment portfolios associated with life insurance can have either positive or negative rates of return.
Insuranceopedia Explains Portfolio Rate Of Return
A positive portfolio rate of return indicates that the portfolio has generated a profit, while a negative rate of return means the investment portfolio has incurred a loss.
In addition to offering investment options for their policyholder, many insurance companies invest the money they receive from premiums to generate higher profits. When these investments perform well, and the portfolio rate of return is high, the insurance company benefits significantly.
