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    Financial Fundamental Calculator- CAGR, Sharpe, Beta & more

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    Attached spreadsheet calculates:

    Compound Annual Growth Rate (CAGR)
    Sharpe Ratio
    Treynor Ratio
    Jensen's Alpha
    Information Ratio

    Required inputs:
    Up to 5 price points or return levels for up to two separate investments
    Up to 5 price points or return levels for a market index
    Up to 5 price points or return levels for a risk-free rate of return

    The Word document uses a simple, hypothetical comparison of two fictional funds as an example.

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    Solution Preview

    CAGR: The first unanswered assumption is how you want to assess each portfolio. I recommend calculating and using CAGR rather than simply averaging the annual returns. See here for why/how: http://www.investopedia.com/terms/c/cagr.asp#axzz1WzjdqB6H

    Sharpe ratio: "The greater a portfolio's Sharpe ratio, the better its risk-adjusted performance has been.," (http://www.investopedia.com/terms/s/sharperatio.asp#ixzz1X6Ega0im)

    Beta: is a measure of the volatility, or systematic risk, of a security or a portfolio in comparison to the market as a whole. A beta ...

    Solution Summary

    Excel spreadsheet useful for calculating various investment benchmarks. Detailed formulas and references included.