How can the Sortino ratio be used to evaluate the risk-adjusted returns of digital assets?

3 answers

• Lujain AlhusneMar 14, 2025 · 4 months ago
  The Sortino ratio is a popular tool used to evaluate the risk-adjusted returns of digital assets. It takes into account the downside risk, which is the risk of losses below a certain threshold. By focusing on downside risk, the Sortino ratio provides a more accurate measure of risk-adjusted performance compared to other ratios like the Sharpe ratio. The higher the Sortino ratio, the better the risk-adjusted returns of the digital asset. It is a useful metric for investors to assess the risk associated with their investments and make informed decisions.
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• Hessellund EgelundJun 28, 2021 · 4 years ago
  The Sortino ratio is like a superhero cape for digital assets. It helps investors evaluate the risk-adjusted returns by considering the downside risk. Unlike other ratios, it doesn't just look at the overall volatility, but specifically focuses on the risk of losses below a certain threshold. This makes it a more reliable measure of risk-adjusted performance. So, if you want to know how well a digital asset performs in terms of risk-adjusted returns, the Sortino ratio is your go-to metric. It's like having a crystal ball that tells you which assets can handle the heat and which ones will burn your fingers.
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• onkar suryavanshiMar 25, 2025 · 4 months ago
  The Sortino ratio is a powerful tool for evaluating the risk-adjusted returns of digital assets. It is widely used by investors and analysts to assess the performance of investments in a more comprehensive way. Unlike other risk-adjusted performance measures, the Sortino ratio takes into account the downside risk, which is particularly important in the volatile world of digital assets. This ratio helps investors understand how much risk they are taking on for a given level of return. It allows them to make more informed decisions and allocate their capital more effectively. So, if you want to evaluate the risk-adjusted returns of digital assets, the Sortino ratio is definitely a metric you should consider.
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