The higher the Sharpe ratio, the less risk you take for your profits.

The Sharpe ratio, however, emphasizes another part of the story.

The Sharpe ratio is the simplest and best known performance measure.

Several statistical tests of the Sharpe ratio have been proposed.

In one version, it has the highest Sharpe ratio.

Therefore, all portfolios should have a Sharpe ratio less than or equal than the market's.

The emphasis on stability is evident in the fund's Sharpe ratio, a measure of risk-adjusted return.

The Sharpe ratio, the basis of the study, is a mathematical formula involving terms that may be unfamiliar to many investors.

Another reason for a misleadingly high Sharpe ratio might be benchmark mis-specification.

Recall that Sharpe ratio is defined as excess return per unit of risk, or in other words:

The Sharpe ratio characterizes how well the return of an asset compensates the investor for the risk taken.

To figure the Sharpe ratio, excess return is divided by the investment's standard deviation - a statistical measure of volatility.

Strategies are compared to each other using diverse performance measurements such as maximum drawdown, annual profit and Sharpe ratio.

To price assets, consequently, the calculated expected values need to be adjusted for an investor's risk preferences (see also Sharpe ratio).

Thus, fundamentally based indices also had a higher Sharpe ratio than capitalization-weighted indices.

It is tangent to the hyperbola at the pure risky portfolio with the highest Sharpe ratio.

The following table shows that this ratio is demonstrably superior to the traditional Sharpe ratio as a means for ranking investment results.

On average, based on their Sharpe ratio, the 41 sector-rotation strategies now being monitored have been 14 percent riskier than the overall stock market.

Pyramid schemes with a long duration of operation would typically provide a high Sharpe ratio when derived from reported returns, but the inputs are false.

Recently, the (original) Sharpe ratio has often been challenged with regard to its appropriateness as a fund performance measure during evaluation periods of declining markets.

Because it is a dimensionless ratio, laypeople find it difficult to interpret Sharpe ratios of different investments.

SFRatio has a striking similarity to Sharpe ratio.

The method of analyzing risk-adjusted return, known as the Sharpe ratio, is a fundamental of modern portfolio theory, an influential approach to investing.

It was designed to replace MPT's Sharpe ratio as a measure or risk-adjusted return.

The table shows risk-adjusted ratios for several major indexes using both Sortino and Sharpe ratios.