Glossary
The terms, defined
Every financial and modeling term that shows up in the simulator, gathered in one place — each one explained down to how we actually compute the value.
- Compound Annual Growth RateCAGR
- The annualized compound growth rate from start value to end value — a single-number return that smooths out volatility.
- Real Return
- Return after subtracting inflation (CPI-U). It strips the change in purchasing power out of the nominal figure.
- Zillow Home Value IndexZHVI
- A smoothed, median home-value index by region. It drives the property-value trajectory in the real estate model.
- Capitalization RateCap Rate
- Net operating income (NOI) divided by asset value — a gauge of a rental property's profitability.
- CPI-U
- The Consumer Price Index for All Urban Consumers. It's the baseline used to deflate every series in real mode.
- Expense Ratio
- A fund's management fee. It's deducted against the balance at month-end — the simulator surfaces it rather than burying it.
- Vacancy Rate
- The share of time a rental sits empty earning nothing. The real estate model defaults to the HUD national average (8.2%).
- Dividend Reinvestment
- Using dividends received to buy more of the same asset. The stock model reinvests at the closing price of the payment month.