Risk Metrics
Core portfolio metrics based on Modern Portfolio Theory and the mean-variance framework.
Sharpe Ratio
The Sharpe ratio quantifies how much excess return you receive for the extra volatility of holding a riskier asset. A higher Sharpe ratio indicates better risk-adjusted performance.
Expected Return
Expected return is the weighted average of individual holding returns, based on historical data. It represents the most likely annual return, though actual results will vary.
Standard Deviation (Volatility)
Standard deviation quantifies the dispersion of returns around the average. A lower value means more predictable returns, while higher values indicate greater uncertainty.
Risk Classification
Risk classification provides a simple 1-5 scale rating based on your portfolio's volatility. Level 1 is most conservative; Level 5 is most aggressive.