Sharpe Ratio
The Sharpe ratio is a financial ratio that measures the risk-adjusted return of an investment or a portfolio. It was developed by Nobel laureate William F. Sharpe.
Gouri Sankar Dash
Capital Allocation Line (CAL line)
The Capital Allocation Line (CAL) is a straight line that represents the trade-off between expected return and risk for a portfolio that consists of a risk-free asset and a risky portfolio.
Efficient Frontier
The Efficient Frontier is a graph that represents the set of all possible portfolios that can be constructed from a given set of assets.
Capital allocation across risky and risk-free portfolios
Capital allocation across risky and risk-free portfolios involves determining the optimal allocation of an investor's capital between a portfolio of risky assets and a risk-free asset .
Utility Score and Risk Aversion
Utility score of a portfolio is a measure of the overall satisfaction or happiness that an investor derives from the portfolio's performance, taking into account the investor's risk aversion and preferences.
Liquidity Ratios
Liquidity ratios are financial ratios that measure a company's ability to meet its short-term obligations.
Profitability Ratio
The profitability Ratio defines how well the company can generate profits by utilising its assets and controlling expenses.