hurdle rate

British  

noun

1. finance the rate of return that a proposed project must provide if it is to be worth considering: usually calculated as the cost of the capital involved adjusted by a risk factor

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Example Sentences

Asked if he could buy Spirit, Minicucci touts Alaska’s record of acquiring Virgin America and Hawaiian Airlines, but says there is a “really, really high” hurdle rate for mergers and acquisitions in aviation.

From The Wall Street Journal • Apr. 21, 2026

A fund might fail to clear the minimum annualized return threshold, known as a hurdle rate.

From The Wall Street Journal • Nov. 20, 2025

With a higher weighted-average cost of capital, the hurdle rate for new investments increases and fewer investments are chosen with today's net present value, discounted ROI models.

From New York Times • Feb. 24, 2017

High interest rates also raised the "hurdle" rate of return, snuffing out investments that in the past would have been profitable.

From New York Times • Jan. 1, 2013

A high premium hikes the project hurdle rate, making it harder to justify new investments, and vice versa.

From BusinessWeek • Sep. 28, 2011