what is return on risk adjusted capital rorac 
the return on risk adjusted capital rorac is a rate of return measure commonly used in financial analysis where various projects endeavors and investments are evaluated based on capital at risk projects with different risk profiles are easier to compare with each other once their individual rorac values have been calculated the rorac is similar to return on equity roe except the denominator is adjusted to account for the risk of a project the formula for rorac isreturn on risk adjusted capital is calculated by dividing a company s net income by the risk weighted assets return on risk adjusted capital net income risk weighted assets where risk weighted assets allocated risk capital economic capital or value at risk begin aligned text return on risk adjusted capital frac text net income text risk weighted assets textbf where text risk weighted assets allocated risk capital economic text capital or value at risk end aligned return on risk adjusted capital risk weighted assetsnet income where risk weighted assets allocated risk capital economiccapital or value at risk 