You’ve probably heard investing professionals talk about risk-adjusted returns. This is a way of measuring the performance of an investment that factors in risk—specifically, the extra risk required ...
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From Risk to Reward: Understanding the Sharpe Ratio
The Sharpe Ratio is a mathematical formula which measures the performance of an asset or a group of assets relative to their assumed risk. Formulaically, the Sharpe Ratio is the expected returns of an ...
The Treynor ratio and the Sharpe ratio are financial metrics that use different approaches to evaluate the risk-adjusted returns of an investment portfolio. The Treynor ratio employs beta and measures ...
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When you begin exploring mutual funds, returns usually take center stage. They are the first numbers you notice, and the ones most advertisements draw your attention toward. Yet, as you look closer, ...
Post-modern portfolio theory uses downside risk to refine portfolio optimization. Learn how PMPT offers an alternative to modern portfolio theory for risk-adjusted returns.
Many individual investors aren't familiar with Sharpe ratios. However, the Sharpe ratio is a useful and intuitive tool to measure portfolio performance. It's used extensively to judge the performance ...
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