| Reward-to-Variability Ratio (RVAR) |
William F. Sharpe, winner of the 1990 Nobel Prize in Economics, is a Professor of Finance, Emeritus at Stanford University’s Graduate School of Business. In addition, he is also a trustee of the AXA Rosenberg Mutual funds and serves as Chairman of the Board of Financial Engines, Incorporated. Years back, Dr Sharpe introduced RVAR as a measurement for the performance of mutual funds (unit trust) which is also commonly known as Sharpe Ratio, Sharpe Index or Sharpe Measure. |
| Ranking Grade |
The funds are ranked based on their returns/risk/reward-to-variability. The numbers (after each grade) are the position of the funds within the scope.
| Quartile |
Grade |
Remark |
| 1st Q |
A |
Excellent |
| 2nd Q |
B |
Good |
| 3rd Q |
C |
Average |
| 4th Q |
D |
Below Average |
Example: There are 12 funds in a chosen scope, the ranks are as follow:
| 1st Q: |
A1, |
A2 |
& |
A3 |
| 2nd Q: |
B4, |
B5 |
& |
B6 |
| 3rd Q: |
C7, |
C8 |
& |
C9 |
| 4th Q: |
D10, |
D11 |
& |
D12 |
If a fund is ranked B5, it means that within the 12 funds, it is in the 5th position under Grade B category. |
