Sharpe Ratio
The Sharpe Ratio (SR) is a measure of risk-adjusted return, calculated as the excess return over the risk-free rate divided by the standard deviation of the portfolio's returns.
Example: If a fund returns 9% in a year, has a 5% standard deviation, and the risk-free rate is 2%, the Sharpe Ratio is (9% - 2%) / 5% = 1.4.
💬 Comments