Probably the most simple explanation of this investment formula. Everyone else out there makes it sound like calculus... thank you!
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Just passed my finance final because of you. Thank you!
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This channel is like maximum learning per time spent, the McLaughlin ratio :)
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Well explained video sir.
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This guy really hits the nail on the head with most of his videos. Salut you sir.
@Edspira2 жыл бұрын
Thank you!
@InvestOrama3 жыл бұрын
What an amazing channel! So much teaching available for free (except a few seconds of our time spent watching ads)
@Edspira3 жыл бұрын
Glad you enjoy it!
@InvestOrama3 жыл бұрын
@@Edspira Sure did! And it's inspiring my own course on alternative investments
@sportingdirector112 күн бұрын
Heck I would watch the whole ad to support
@ethans79175 жыл бұрын
I’m still in high school but I just find finance so interesting! Thank you for ur explanation
@kaiguo39075 жыл бұрын
Thank you for sharing such a helpful interpretation of sharp ratio, I am so excited to see more videos from you.
@luca9961Ай бұрын
But if at the denominator we have the standard deviation, doesn't the Sharpe ratio penalizes the upward volatility as well ? Which is not desirable? Or it is based upon all volatility will imply sooner or later the same in the oposite direction, hence it's bad ?
@vapa57615 жыл бұрын
Dude, your videos are golden, glad that i came across your channel
@grodrigues32 ай бұрын
Didn't watch the video on efficient portfolio's but based on the graph, it looks like the purple part is efficient because taking on more risk yields BETTER reward and and the yellow part is where taking on more risk yields WORSE rewards. Does the yellow section all have a negative sharpe ratio?
@joshuafancher31116 жыл бұрын
Thank you. Thoroughly explained.
@megawarpig34019 ай бұрын
So the portfolio of risky assets tangent to the CML has the highest Sharpe Ratio. But all the portfolio on the CML have the same Sharpe Ratio, since the slope of the CML is the Sharpe Ratio, correct? And the points on the CML can be obtained by a combination of the risk-free asset and the tangent portfolio of risky assets, right?
@irinascott2941 Жыл бұрын
Is market portfolio the same as tangency portfolio? Plz reply I have an exam on Monday
@adokoka4 жыл бұрын
Very clear explanation. Could you please make a video on the sortino ratio? Many thanks in advance!
@kasbiia6 жыл бұрын
your videos have been so helpful over the semesters thank you so much!
@juanochoa39724 жыл бұрын
Thank you so much for the explanation. Do you have an excel sheet as an example. With daily data?. Rgds and thanks!
@coachgeflores3 жыл бұрын
Very informative video. Are you using Geometric or Arithmetic Rates of Return and Standard Deviations?
@douglashurd43562 жыл бұрын
How can the dividend yield rate be included in the calculation? Is it reasonable to say S = (rtn + div yield - risk free) / stddev(rtn) ???
@Tiberius_Gracchus4 жыл бұрын
Great video, you are a gifted teacher, keep up the good work!
@joannaortiz90153 жыл бұрын
I understand it now! Thank you!!!
@wolfgangi5 жыл бұрын
what do we mean by underperform in this context? My understanding of the written definition is that how many SD (risk) the portfolio must decrease in order to achieve the most optimal portfolio ( the portfolio tangent to the CML) ?? Is this the correct understanding???
@milzijex73404 жыл бұрын
Wolfgang Icarus, No - in his example if portfolio falls by 0.5 sd then it will underperform the risk free rate
@Discovery_and_Change11 ай бұрын
Where do we find the volatility of an ETF? What's it called? Is it labeled as 'volatility' or 'beta' ?
@horangi16092 жыл бұрын
Hii is this the same as the market price of risk?
@irinascott2941 Жыл бұрын
So how do u calculate the market portfolio?
@maxmudbekmurodov69385 жыл бұрын
The most comprehensive video on youtube) would be even better if you include some specific examples ! Thank you anyway)
@AlaraDincYT3 жыл бұрын
as always... an amazing video! thank you
@the_freedom_quest2 жыл бұрын
Thank you so much
@Edspira2 жыл бұрын
You're most welcome
@lukashuber3893 жыл бұрын
great video!!
@hazirahashim19044 жыл бұрын
volatility does not equal risk. volatility is how much the data disperses from the expected value. risk is the probability that the investor deviates from their expected return. Variance measures volatility & not risk. One of the measures of risk is Standard Deviation.
@Rushmanism3 жыл бұрын
Great video - Can anyone tell me why my best-performing stock has the worst sharpe ratio at-52% ( this is based on just 1 stock and its SD and ER not a portfolio).
@josephmandarino2199 Жыл бұрын
Sharp ratio doesn't really work on a single stock
@Kirmo135 ай бұрын
why is volatility equal to risk?
@samamdrews80763 ай бұрын
what if the portfolio is a short portfolio?
@Jupiter14232 жыл бұрын
Never agreed with the cml being the portfolio of rationality. As warren buffet said - divsersification is for people who dont know how to invest. Thered nothing irrational about taking on more risk if you can manage it... hedging comes big into this.
@rayne5368Ай бұрын
But sharpe ratio changes all the time, and no one can predict whether a fund will perform better in the long run.
@Blank-yc9hm4 жыл бұрын
risk free investion means less risk
@nickhurley24723 жыл бұрын
Where is the factor for standard of living? Yea, didn't think so...