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Pain Ratio Calculator

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Risk Management

✖Effective Return is a measure that accurately calculates the actual amount of return gained on an investment, taking into account the effects of compounding over a certain period.ⓘ Effective Return [ER]			+10% -10%
✖Pain Index is a tool for advisors to help them define and measure risk in terms investors can feel and relate to how much money they might lose.ⓘ Pain Index [PI]			+10% -10%

✖Pain Ratio provides a better assessment for understanding the amount of return per unit of risk, measured in terms of capital preservation.ⓘ Pain Ratio [PR]

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Pain Ratio Solution

STEP 0: Pre-Calculation Summary

Formula Used

Pain Ratio = Effective Return/Pain Index
PR = ER/PI
This formula uses 3 Variables

Variables Used

Pain Ratio - Pain Ratio provides a better assessment for understanding the amount of return per unit of risk, measured in terms of capital preservation.
Effective Return - Effective Return is a measure that accurately calculates the actual amount of return gained on an investment, taking into account the effects of compounding over a certain period.
Pain Index - Pain Index is a tool for advisors to help them define and measure risk in terms investors can feel and relate to how much money they might lose.

STEP 1: Convert Input(s) to Base Unit

Effective Return: 110 --> No Conversion Required
Pain Index: 15 --> No Conversion Required

STEP 2: Evaluate Formula

Substituting Input Values in Formula

PR = ER/PI --> 110/15

Evaluating ... ...

PR = 7.33333333333333

STEP 3: Convert Result to Output's Unit

7.33333333333333 --> No Conversion Required

FINAL ANSWER

7.33333333333333 ≈ 7.333333 <-- Pain Ratio

(Calculation completed in 00.004 seconds)

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Credits

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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Pain Ratio Formula

LaTeX Go

Pain Ratio = Effective Return/Pain Index
PR = ER/PI

What is Pain Ratio?

The Pain Ratio provides a better assessment for understanding the amount of return per unit of risk, measured in terms of capital preservation.Like all ratios, the higher the pain ratio the better, since return is in the numerator and risk in the denominator. In order to ascertain what a “good” number is, one must compare against the pain ratios of peers or asset class indices.

How to Calculate Pain Ratio?

Pain Ratio calculator uses Pain Ratio = Effective Return/Pain Index to calculate the Pain Ratio, The Pain Ratio provides a better assessment for understanding the amount of return per unit of pain index which evaluates investments for the up, down, and side-to-side risk. Pain Ratio is denoted by PR symbol.

How to calculate Pain Ratio using this online calculator? To use this online calculator for Pain Ratio, enter Effective Return (ER) & Pain Index (PI) and hit the calculate button. Here is how the Pain Ratio calculation can be explained with given input values -> 4.666667 = 110/15.

FAQ

What is Pain Ratio?

The Pain Ratio provides a better assessment for understanding the amount of return per unit of pain index which evaluates investments for the up, down, and side-to-side risk and is represented as PR = ER/PI or Pain Ratio = Effective Return/Pain Index. Effective Return is a measure that accurately calculates the actual amount of return gained on an investment, taking into account the effects of compounding over a certain period & Pain Index is a tool for advisors to help them define and measure risk in terms investors can feel and relate to how much money they might lose.

How to calculate Pain Ratio?

The Pain Ratio provides a better assessment for understanding the amount of return per unit of pain index which evaluates investments for the up, down, and side-to-side risk is calculated using Pain Ratio = Effective Return/Pain Index. To calculate Pain Ratio, you need Effective Return (ER) & Pain Index (PI). With our tool, you need to enter the respective value for Effective Return & Pain Index 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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