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7 Mins read
•Mutual Fund

Decoding Mutual Fund Risk Metrics in 2024: Beta, Standard Deviation, and Sharpe Ratio Explained

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Summary

The blog explains key risk metrics used to evaluate mutual funds, including Beta, Alpha, Standard Deviation, and Sharpe Ratio. It provides examples to illustrate how each metric measures relative risk, risk-adjusted returns, and volatility, and concludes with an overview of future topics such as Sortino’s Ratio and portfolio construction. The glossary clarifies related financial terms.

Key Takeaways

  • Beta compares fund risk to a benchmark.
  • Alpha shows risk-adjusted excess returns.
  • Standard Deviation indicates fund volatility.
  • Sharpe Ratio measures return per unit of risk.

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