LEARNING CENTER
Level | Advanced
WHAT RISK MEASURES SHOULD YOU KNOW OF WHILE INVESTING?
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Key Takeaways

  1. Risk is defined as the chance that an investment's actual return will vary from its expected return.

  2. High Alpha, Sharpe Ratio and Treynor Ratio indicate better potential performance, low Beta and Standard Deviation indicate low volatility and a higher R-Squared indicates a better correlation with the benchmark.

  3. The combination of a number of risk measurement tools can help you to understand volatility, historical returns and a fund manager’s value added performance.