Question

which one of the following measures a security's return in relation to the total risk associated with that security? group of answer choices sharpe ratio treynor ratio beta jensen's alpha

Answer 1

Answer and Explanation:

Both the Sharpe and Treynor Ratios are used to understand an investment's risk-adjusted return. The Sharpe Ratio divides the excess return by the investment's standard deviation. The Treynor Ratio instead divides excess returns by the investment's Beta.