The Treynor Ratio is a portfolio performance measure that illustrates the excess return per unit of systematic risk. It is an extension of the Sharpe ratio but instead of using total risk, it incorporates beta, or systematic risk, in the denominator. In the numerator, you can find the risk premium. And the higher the ratio, the more preferrable the investment.
This open-access Excel template is a useful tool for statisticians, financial analysts, data analysts, portfolio managers, and anyone working with spreadsheet software.
Treynor Ratio is among the topics included in the Portfolio Management module of the CFA Level 1 Curriculum. Gain valuable insights into the subject with our Portfolio Management course.
You can also explore other related templates such as—Sharpe Ratio, M2 Ratio, and Jensen’s Alpha.