## What is the Treynor ratio?

## What is the Treynor index and why is it important?

- The higher the
**Treynor**Index, the greater the excess return being generated by the portfolio per each unit of overall market risk. The**Treynor**Index is also known as the**Treynor**Ratio or the reward-to-volatility ratio.

## What is Treynor ratio in keykey?

- Key Takeaways. The
**Treynor**ratio is a risk/return**measure**that allows investors to adjust a portfolio'**s**returns for systematic risk. A higher**Treynor**ratio result means a portfolio is a more suitable investment.

## What is the difference between Sharpe index and Treynor ratio?

- The Sharpe Ratio (or Sharpe Index) is commonly used to gauge the performance of an investment by adjusting for its risk. , which adjusts return with the standard deviation of the portfolio, the
**Treynor**Ratio uses the Portfolio Beta, which is a**measure**of systematic risk.

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