The Sharpe ratio is one way to capture this risk-versus-reward detail and give investors extra insight into their assets' performance. Some investors use an index fund as a benchmark and attempt ...

For example, imagine a portfolio with an annual return of 9%, a risk-free rate of 3% and a beta of 1.2. The Treynor ratio ...

And to analyse risks, a Sharpe Ratio is a key metric. The formula for calculating the Sharpe Ratio is—(investment return—risk-free return rate)/ standard deviation of returns. Standard ...

Modern Portfolio Theory leverages the Sharpe ratio to enhance portfolio construction by emphasizing asset class correlations – especially in fixed income. Using Morningstar index data ...