hurdle rate

British  

noun

1. finance the rate of return that a proposed project must provide if it is to be worth considering: usually calculated as the cost of the capital involved adjusted by a risk factor

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Example Sentences

A fund might fail to clear the minimum annualized return threshold, known as a hurdle rate.

From The Wall Street Journal

“The hurdle rate for our investments has gotten higher. And that means that some initiatives what that requires substantial capital will be slowed. We have to make sure our unit economics work before we go big.”

From The Verge

“Investors’ expectations of the stock market now have risen and it just means the hurdle rate is higher for positive surprises,” Lerner said.

From Reuters

The Bank of England sets each bank its own hurdle rate.

From BBC

With a higher weighted-average cost of capital, the hurdle rate for new investments increases and fewer investments are chosen with today's net present value, discounted ROI models.

From New York Times