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Q » Define Treynor ratio.

Steven

06 Dec, 2025

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A » The Treynor ratio is a financial metric that evaluates the excess return per unit of risk taken, where risk is measured by beta, a measure of market volatility. It is calculated by subtracting the risk-free rate from the portfolio return and dividing the result by the portfolio's beta. This ratio helps investors understand how well their investment compensates for market risk, guiding informed decisions in portfolio management.

Michael

06 Dec, 2025

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A »The Treynor ratio is a risk-adjusted performance metric that measures the excess return of a portfolio over the risk-free rate, relative to its systematic risk (beta). It helps investors evaluate a portfolio's performance by comparing its returns to the risk taken, with higher ratios indicating better risk-adjusted returns.

David

06 Dec, 2025

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