an after-tax return of 4.25% 0.05 x 0.15 = 0.0075 0.05 − 0.0075 = 0.0425 = 4.25% A return of 10% taxed at 25% gives an after-tax return of 7.5% 0.10 x 0.25 = 0.025 0.10 − 0.025 = 0.075 = 7.5% Investors usually seek a higher rate of return on taxable investment returns than on non-taxable investment returns, and the proper way to compare returns taxed at different rates of tax is after tax, from the end-investor's perspective. A return may be adjusted for inflation. When return is adjusted for inflation, the resulting return in real terms measures the change in purchasing power between the start and the end of the period. Any investment with a nominal annual return (i.e., unadjusted annual return) less than the annual inflation rate represents a loss of value in real terms, even when the nominal annual return is greater than 0%, and the purchasing power at the end of the period is less than the purchasing power at the beginning. Many online poker tools include ROI in a player's tracked statistics, assisting users in evaluating an opponent's performance. Time value of money Investments generate returns to the investor to compensate the investor for the time value of money. Factors that investors may use to determine the rate of return at which they are willing to invest money include: their risk-free interest rate estimates of future inflation rates assessment of the risk of the investment, i.e. the uncertainty of returns (including how likely it is that investors will receive interest/dividend payments they expect and the return of their full capital, with or without any possible additional capital gain) currency risk whether or not the investors want the money available (“liquid”) for other uses. The time value of money is reflected in the interest rate that a bank offers for deposit accounts, and also in the interest rate that a bank charges for a loan such as a home mortgage. The "risk-free" rate on US dollar investments is the rate on U.S. Treasury bills, because this is the highest rate available without risking capital. The rate of return which an investor requires from a particular investment is called the discount rate, and is also referred to as the (opportunity) cost of capital. The higher the risk, the higher the discount rate (rate of return) the investor will demand from the investment. Compounding or reinvesting The