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How to treat the sharp proportion of funds
Sharp ratio, also known as Sharp index, is a standardized index for fund performance evaluation. The study of Sharp ratio in modern investment theory shows that the risk plays a fundamental role in determining the performance of portfolio. Risk-adjusted rate of return is a comprehensive index that can consider both income and risk, and can eliminate the adverse effects of risk factors on performance evaluation for a long time. Sharp ratio is one of the three classic indicators that comprehensively consider income and risk. There is a conventional characteristic in investment, that is, the higher the expected return of the investment target, the higher the fluctuation risk that investors can tolerate; Conversely, the lower the expected return, the lower the risk of fluctuation. Therefore, the main purposes of rational investors in choosing investment objects and portfolios are: to maximize returns under the condition of fixed risks; Or pursue the lowest risk under the fixed expected return.

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