Absolute Return

Absolute Return
The return that an asset achieves over a period of time. This measure simply looks at the appreciation or depreciation (expressed as a percentage) that an asset - usually a stock or a mutual fund - faces over a period of time. Absolute return differs from relative return because it is concerned with the return of the asset being looked at and does not compare it to any other measure.
Absolute return funds look to make positive returns whether the overall market is up or down, while index tracking funds try to beat the index they are tracking. For example, if there has been a 5% increase in the price of Ford stock over the past year, then the holders of Ford stock have achieved an absolute return of 5% over the past year.
Introduction To Hedge Funds - Part One - Learn everything you need to know about the characteristics and strategies of hedge funds. Introduction To Hedge Funds - Part Two - Discover the advantages and pitfalls of hedge funds and the questions to ask when choosing one. What's the difference between absolute and relative return?