Performance Measures Flashcards

1
Q

Jensen’s alpha

A

Also known as Jensen’s Performance Index. Alpha measures the portfolio’s actual or realized return in excess of the expected return.

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2
Q

Treynor Ratio

A

Uses Beta in it’s denominator and therefore may be used only to compare the performance of diversified portfolio of diversified portfolios or stocks that constitute diversified portfolios.

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3
Q

Sharpe. Ratio

A

Uses standard deviation in its denominator and therefore is a catchall formula

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4
Q

Sharpe Ratio

A

Uses standard deviation in its denominator and therefore is a catchall formula

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