What is Capital Charge?
In this glossary, Capital Charge refers to: The minimum return required on invested capital, representing the cost of capital multiplied by invested capital, used in performance measurement frameworks such as Economic Value Added (EVA) and regulatory capital models.
How is Capital Charge used in finance?
In finance communication, this term appears in contexts such as: "Economic profit is calculated after deducting the capital charge from net operating profit after taxes."
Why does Capital Charge matter in finance?
Capital Charge matters because it supports clear communication in Analysis contexts for Financial Analysts, Bankers, and Traders. It also connects to aviation training and exam language such as CFA, ACCA, and FRM.
Who uses Capital Charge?
Capital Charge is mainly used by Financial Analysts, Bankers, and Traders.
What category does Capital Charge belong to?
In this glossary, Capital Charge is grouped under Analysis. Related pages in this category explain adjacent procedures, commands and operational concepts.
Where does this definition come from?
This definition is sourced from CFA Institute, IFRS Foundation, FASB (GAAP), Basel III Framework and published by Protermify Finance as a static finance reference page.
