How can the Treynor ratio help investors assess the risk-adjusted returns of different cryptocurrencies?

3 answers

• Cyndy GutierrezNov 25, 2020 · 5 years ago
  The Treynor ratio is a useful tool for investors to assess the risk-adjusted returns of different cryptocurrencies. It takes into account both the return of the investment and the level of systematic risk associated with it. By dividing the excess return of a cryptocurrency by its beta, the Treynor ratio provides a measure of how much return an investor can expect for each unit of systematic risk taken. This ratio allows investors to compare the risk-adjusted returns of different cryptocurrencies and make informed investment decisions.
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• du buddyAug 03, 2022 · 3 years ago
  The Treynor ratio is a metric that helps investors evaluate the risk-adjusted returns of cryptocurrencies. It considers the systematic risk, or beta, of a cryptocurrency and compares it to the excess return it generates. The higher the Treynor ratio, the better the risk-adjusted return. This ratio is particularly useful for investors who want to assess the performance of their cryptocurrency investments relative to the market. By using the Treynor ratio, investors can identify cryptocurrencies that provide higher returns for the level of risk taken.
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• Filipa SousaJun 13, 2025 · 2 months ago
  The Treynor ratio is a popular tool used by investors to assess the risk-adjusted returns of different cryptocurrencies. It measures the excess return of a cryptocurrency relative to its systematic risk, as represented by its beta. A higher Treynor ratio indicates that a cryptocurrency has generated a higher return for the level of risk taken. Investors can use this ratio to compare the risk-adjusted returns of various cryptocurrencies and make informed investment decisions. However, it's important to note that the Treynor ratio is just one of many factors that investors should consider when evaluating cryptocurrencies.
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