HCF of three numbers

Calmar Ratio Calculator

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Risk Management

✖Average Rate of Return is the average annual return (profit) from an investment. It is calculated by dividing the average annual profit by the cost of investment and multiplying by 100 percent.ⓘ Average Rate of Return [ARR]			+10% -10%
✖Maximum Drawdown is the maximum observed loss from a peak to a trough of a portfolio, before a new peak is attained. Maximum drawdown is an indicator of downside risk over a specified time period.ⓘ Maximum Drawdown [MDD]			+10% -10%

✖Calmar Ratio is is a measure of risk-adjusted returns for investment funds which uses a fund’s maximum drawdown as its sole measure of risk.ⓘ Calmar Ratio [CR]

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Calmar Ratio Solution

STEP 0: Pre-Calculation Summary

Formula Used

Calmar Ratio = (Average Rate of Return/Maximum Drawdown)*-1
CR = (ARR/MDD)*-1
This formula uses 3 Variables

Variables Used

Calmar Ratio - Calmar Ratio is is a measure of risk-adjusted returns for investment funds which uses a fund’s maximum drawdown as its sole measure of risk.
Average Rate of Return - Average Rate of Return is the average annual return (profit) from an investment. It is calculated by dividing the average annual profit by the cost of investment and multiplying by 100 percent.
Maximum Drawdown - Maximum Drawdown is the maximum observed loss from a peak to a trough of a portfolio, before a new peak is attained. Maximum drawdown is an indicator of downside risk over a specified time period.

STEP 1: Convert Input(s) to Base Unit

Average Rate of Return: 12 --> No Conversion Required
Maximum Drawdown: -50 --> No Conversion Required

STEP 2: Evaluate Formula

Substituting Input Values in Formula

CR = (ARR/MDD)*-1 --> (12/(-50))*-1

Evaluating ... ...

CR = 0.24

STEP 3: Convert Result to Output's Unit

0.24 --> No Conversion Required

FINAL ANSWER

0.24 <-- Calmar Ratio

(Calculation completed in 00.005 seconds)

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Created by Keerthika Bathula

Indian Institute of Technology, Indian School of mines, Dhanbad (IIT ISM Dhanbad), Dhanbad

Keerthika Bathula has created this Calculator and 100+ more calculators!

Verified by Vishnu K

BMS College of Engineering (BMSCE), Bangalore

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Upside/Downside Ratio

LaTeX Go Upside/Downside Ratio = Advancing Issues/Declining Issues

Calmar Ratio Formula

LaTeX Go

Calmar Ratio = (Average Rate of Return/Maximum Drawdown)*-1
CR = (ARR/MDD)*-1

What is Calmar Ratio?

The Calmar ratio indicates the relationship between risk and return. It is a function of the expected annual rate of return and the maximum drawdown over the previous three years. It is used to assess the success of various hedge funds and make investment decisions. A high ratio implies that it has higher returns on a risk-adjusted basis over the specified timeframe, usually set at 36 months.

How to Calculate Calmar Ratio?

Calmar Ratio calculator uses Calmar Ratio = (Average Rate of Return/Maximum Drawdown)*-1 to calculate the Calmar Ratio, The Calmar Ratio is a function of the expected annual rate of return and the maximum drawdown over the previous three years. Calmar Ratio is denoted by CR symbol.

How to calculate Calmar Ratio using this online calculator? To use this online calculator for Calmar Ratio, enter Average Rate of Return (ARR) & Maximum Drawdown (MDD) and hit the calculate button. Here is how the Calmar Ratio calculation can be explained with given input values -> 0.6 = (12/(-50))*-1.

FAQ

What is Calmar Ratio?

The Calmar Ratio is a function of the expected annual rate of return and the maximum drawdown over the previous three years and is represented as CR = (ARR/MDD)*-1 or Calmar Ratio = (Average Rate of Return/Maximum Drawdown)*-1. Average Rate of Return is the average annual return (profit) from an investment. It is calculated by dividing the average annual profit by the cost of investment and multiplying by 100 percent & Maximum Drawdown is the maximum observed loss from a peak to a trough of a portfolio, before a new peak is attained. Maximum drawdown is an indicator of downside risk over a specified time period.

How to calculate Calmar Ratio?

The Calmar Ratio is a function of the expected annual rate of return and the maximum drawdown over the previous three years is calculated using Calmar Ratio = (Average Rate of Return/Maximum Drawdown)*-1. To calculate Calmar Ratio, you need Average Rate of Return (ARR) & Maximum Drawdown (MDD). With our tool, you need to enter the respective value for Average Rate of Return & Maximum Drawdown and hit the calculate button. You can also select the units (if any) for Input(s) and the Output as well.

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