Calculation Formula of the Sharpe Ratio The Sharpe Ratio is calculated by subtracting the risk-free rate from the portfolio's return and dividing the resultant excess return by the portfolio’s ...

In Excel, this can be achieved by using the NORM.INV function. This function requires the probability of an event occurring, mean, and standard deviation.

Author's analysis via Excel spreadsheet Above is a chart depicting the expected payout as a function of p at a preset reward/risk ratio of 5.

As a standalone desktop tool, Excel poses a lot of risks. But there are ways to monitor and audit spreadsheets or do the calculations in SQL or in an application developed for trading or risk ...

In Excel, this can be achieved by using the STDEV function. 5. Calculate the VaR for various confidence intervals. In Excel, this can be achieved by using the NORM.INV function.