PORTFOLIO RISK
Sharpe Ratio
Measures excess return per unit of total volatility.
Formula
Sharpe = (R_p-R_f)/σ_p
Variables: Portfolio return; risk-free rate; portfolio volatility
What it means
Measures excess return per unit of total volatility.
Example
Return 8%, risk-free 3%, volatility 10% gives Sharpe 0.5.
How to interpret it
This concept should be read together with its market convention, measurement horizon and underlying instrument. BondStats presents it as an analytical reference rather than investment advice; instrument documentation and primary market rules remain authoritative.
Related Formulas
BondStats reference content is independently written. Mathematical relationships, abbreviations and market conventions are presented for educational and analytical use.