Definition
Sharpe Ratio
Return earned for each unit of risk taken.
The Sharpe ratio measures how much return an investment earned above the risk-free rate for each unit of volatility it took on — a way to judge whether returns came from skill or simply from taking bigger risks. Higher is generally better; a Sharpe comfortably above 1 is often considered strong. Market Lens calculates the Sharpe ratio in its portfolio analytics so you can compare risk-adjusted performance, not just raw returns.
Related terms
See it on a real stock
Market Lens puts Sharpe Ratio to work automatically in every report — free, no sign-up.