Sharpe Ratio Calculator

About this calculator

This calculator finds the Sharpe ratio, developed by Nobel laureate William Sharpe: (Rp − Rf) / σp, where Rp is the portfolio's return, Rf is the risk-free rate (typically a Treasury bill yield), and σp is the standard deviation of the portfolio's excess returns. It expresses how much extra return an investment delivers per unit of volatility risk taken.

Portfolio managers, financial analysts, and individual investors use it to compare investments or funds on a risk-adjusted basis — a higher Sharpe ratio means better returns for the risk taken, which is useful when a high-return fund is also high-volatility. Enter the portfolio return, risk-free rate, and standard deviation to get the ratio.