The Sharpe index measures the
A)average return on a stock.
B)variability of stock returns per unit of return.
C)stock's beta adjusted for risk.
D)excess return above the risk-free rate per unit of risk.

Question

Quizplus · Accepted Answer

The Sharpe index, also known as the Sharpe ratio, measures the excess return (return above the risk-free rate) per unit of risk (standard deviation of the portfolio returns), helping investors understand the return of an investment compared to its risk.

The Sharpe Index Measures the