Overview
The Sharpe Ratio Template calculates the Ratio for portfolios that have different expected returns, standard deviations and expected returns. It also plots the resultant Sharpe ratios in a line graph to show the risk-return relationship of the various portfolios. The Sharpe Ratio is a widely used ratio to gauge the performance of an investment using a risk-adjusted return. The formula for the Sharpe Ratio is the following:
Sharpe Ratio = (Rp – Rf) / (StdDev Rp)
Where:
Rp = Expected return of the portfolio
Rf = Risk-Free Rate of Return
StdDev Rp = Is the Standard Deviation of Portfolio Returns (volatility)
Tags
Share
Reviews Add a review
No reviews yet