Unknown Indicator

Treynor Ratio In A Nutshell

Using the Treynor ratio is essentially measuring the returns of your investment minus what you may have earned in an environment where there was minimal to no risk. This is important because you can measure how much of a premium your equity may be trading at or a discount. Not only that, but you can being to measure the amount of risk you are taking for the return on investment you are getting.

There are many ratios out there that measure anything from risk to cash flow, but the Treynor ratio is around to help traders and investors measure risk to reward.

Closer Look at Treynor Ratio

If you have yet to understand risk, begin looking at other risk measurements such as risk adjusted performance and understand what the risk free rate of return is. Ratios us as this are meant to help you mitigate risk and continue to bring in underprice equities. The goal of any portfolio is to increase risk while keeping a stable risk level.

Risk is one of the most important aspects of investing and finance and should be monitored with care. Using this ratio can also help you compared equities apples to apples, letting you understand which investments may be offering better value than others. When implementing this you should doodle on the side until you fully understand how to use this ratio. After that, feel free to implement this as you wish and begin exploring the world of risk. If you get stuck, reach out to an investing professional and they can help to point you in the right direction.

Use Investing Themes to Complement your positions

You can quickly originate your optimal portfoio using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.

Did You Try This Idea?

Run Broad Commodities ETFs Thematic Idea Now

Broad Commodities ETFs
Broad Commodities ETFs Theme
ETF themes focus on helping investors to gain exposure to a broad range of assets, diversify, and lower overall costs. The Broad Commodities ETFs theme has 25 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Broad Commodities ETFs Theme or any other thematic opportunities.
View All  Next Launch
Check out your portfolio center.
Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.

Other Complementary Tools

Risk-Return Analysis
View associations between returns expected from investment and the risk you assume
Bonds Directory
Find actively traded corporate debentures issued by US companies
Funds Screener
Find actively-traded funds from around the world traded on over 30 global exchanges
Portfolio Volatility
Check portfolio volatility and analyze historical return density to properly model market risk
Aroon Oscillator
Analyze current equity momentum using Aroon Oscillator and other momentum ratios