Investing money into the markets has a high degree of risk. Learn to calculate your risk and reward so the amount you stand to gain is worth the risk you take.

The risk-free rate of return reflects three core components theoretically: Calculating return is crucial for understanding the performance of an investment. A commonly used formula is the return ...

Getty Images The risk-free rate of return is one of the most basic components of modern finance. The risk-free asset only applies in theory, but its actual safety rarely comes into question until ...

Common uses of the RRR include calculating the present value ... expenditures demand relative to the degree of risk. The required rate of return is often a pivotal factor when deciding between ...

Understanding the Risk-Free Rate and Standard Deviation The three inputs into a Sharpe ratio calculation are your expected return, the risk-free rate and the standard deviation. Your return covers ...

To calculate the Sharpe ratio, you first need your portfolio's rate of return. Next, you need the rate of a risk-free investment, such as Treasury bonds. Subtract this risk-free rate from your ...