what is the nominal rate of return 
the nominal rate of return is the amount of money generated by an investment before factoring in expenses such as taxes investment fees and inflation if an investment generated a 10 return the nominal rate would equal 10 after factoring in inflation during the investment period the actual real return would likely be lower however the nominal rate of return has its merits since it allows investors to compare the performance of an investment irrespective of the different tax rates that might be applied for each investment the formula for the nominal rate of return isnominal rate of return current market value original investment valueoriginal investment value text nominal rate of return frac text current market value text original investment value text original investment value nominal rate of return original investment valuecurrent market value original investment value 