ELI5: Explain Like I'm 5

risk free rate of return

A risk free rate of return is the rate of return- or profit- that you can make on an investment without risking any of your money. It is the lowest amount of money that you can expect to receive back when putting money into an investment such as a savings account. It is called "risk free" because, while you may not make a lot of money, you also cannot lose the money that you put in.
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