Real Return

General Discussion on the Permanent Portfolio Strategy

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vnatale
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Real Return

Post by vnatale » Fri Nov 29, 2019 9:03 pm

So as to create a real return does anyone favor a "CPI Inflation Calculator" over this one?

https://www.bls.gov/data/inflation_calculator.htm

Vinny
"I only regret that I have but one lap to give to my cats."
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vnatale
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Re: Real Return

Post by vnatale » Thu Mar 26, 2020 6:17 pm

vnatale wrote:
Fri Nov 29, 2019 9:03 pm
So as to create a real return does anyone favor a "CPI Inflation Calculator" over this one?

https://www.bls.gov/data/inflation_calculator.htm

Vinny
Asking again to see if I get any response this time around.

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"I only regret that I have but one lap to give to my cats."
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ochotona
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Re: Real Return

Post by ochotona » Fri Mar 27, 2020 3:04 am

CPI calc is very good. To get real return, you don't do subtraction. It's a ratio.

NOT THIS RR = NR - IR

THIS

1+RR/100 = (1+NR/100)/(1+IR/100)

IR inflation rate, NR nominal return, RR real return all in %

The wrong way is close, but not exact.
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