Sharpe Ratio Calculator
Parameter | Description | Example Value |
---|---|---|
Expected Portfolio Return | The expected return of the investment portfolio. | 10% |
Risk-Free Rate | The return on risk-free investments (e.g., government bonds). | 3% |
Portfolio Standard Deviation | The standard deviation of the portfolio’s returns, representing its volatility. | 12% |
Sharpe Ratio | The risk-adjusted return of the investment portfolio (Expected Portfolio Return – Risk-Free Rate) / Portfolio Standard Deviation. | 0.583 |