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Interpreting Sharpe Measure and Treynor Measure

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Interpreting these measurements. (Attached)

What is the importance of them. And what is the difference between the performance of them compared to the market index.

Company R Rf Standard Deviation Sharpe Measure
Walt Disney 8.11 4.6 3.786 0.927
Ford 11.886 4.6 3.786 1.925
Microsoft 6.958 4.6 3.786 0.623
Lowe's 6.83 4.6 3.786 0.589
Wal-mart 1.326 4.6 3.786 -0.865

Company R Rf Beta Treynor Measure
Walt Disney 8.11 4.6 1.26 2.786
Ford 11.886 4.6 1.85 3.938
Microsoft 6.958 4.6 1.08 2.183
Lowe's 6.83 4.6 1.06 2.104
Wal-mart 1.326 4.6 0.2 -16.370

Company Rp Rf Beta rM-rf B(rM-rf) Jensen Measure
Walt Disney 8.11 4.6 1.26 6.4 8.064 -4.554
Ford 11.886 4.6 1.85 6.4 11.84 -4.554
Microsoft 6.958 4.6 1.08 6.4 6.912 -4.554
Lowe's 6.83 4.6 1.06 6.4 6.784 -4.554
Wal-mart 1.326 4.6 0.2 6.4 1.28 -4.554

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Solution Preview

Company R Rf Standard Deviation Sharpe Measure
Walt Disney 8.11 4.6 3.786 0.927
Ford 11.886 4.6 3.786 1.925
Microsoft 6.958 4.6 3.786 0.623
Lowe's 6.83 4.6 3.786 0.589
Wal-mart 1.326 4.6 3.786 -0.865

Company R Rf Beta Treynor Measure
Walt Disney 8.11 4.6 1.26 2.786
Ford 11.886 4.6 1.85 3.938
Microsoft 6.958 4.6 1.08 2.183
Lowe's 6.83 4.6 1.06 2.104
Wal-mart 1.326 4.6 0.2 -16.370

Company Rp Rf Beta rM-rf B(rM-rf) Jensen Measure
Walt Disney 8.11 4.6 1.26 6.4 8.064 -4.554
Ford 11.886 4.6 1.85 6.4 11.84 -4.554
Microsoft 6.958 4.6 1.08 6.4 6.912 -4.554
Lowe's ...

Solution Summary

This solution is comprised of a detailed explanation to interpret Sharpe Measure and Treynor Measure and explain what is the difference between the performance of them compared to the market index.

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