#SharpRatio #InvestmentPerformance #RealEstate #StockMarket #RiskAdjustedReturns

Manny Kim from Giza Capital joins the show to discuss the Sharp Ratio and its application to income property. The Sharp Ratio, developed by William F. Sharp, measures the reward-to-variability ratio of an investment and is widely used in quantitative finance. It compares the excess return of an asset class to the standard deviation of that return, providing a single number to assess investment performance. This ratio allows for apples-to-apples comparisons between different asset classes, including real estate and stocks. Real estate tends to have lower volatility than stocks due to its lower liquidity, making it a potentially attractive investment. However, it is important to consider the assumptions and limitations of the Sharp Ratio, such as the stability of variance and the distribution of returns. By calculating the Sharp Ratio, investors can evaluate risk-adjusted returns and make informed investment decisions.

Key Takeaways:

Jason’s editorial

0:00 Welcome to Portofino, Italy
3:23 “Buy and Hold”
4:44 The “Due On Sale” Clause- addressing the housing shortage
5:46 Massively low rates

Manny Kim interview

7:22 Introducing the Sharpe Ratio
7:56 How and why the Sharpe Ratio applies to income property and not just the stock market
9:25 What is the Sharpe ratio
10:58 A theoretical sample
11:57 Income property- a better risk adjusted return
13:35 Pros and cons
15:50 Actual calculations for stock market and income property
17:02 Calculating the Sharpe ratio for the stock market
20:02 Comparing the stock market versus income property

___________________________________________________
Follow Jason on TWITTER, INSTAGRAM & LINKEDIN
Twitter.com/JasonHartmanROI
Instagram.com/jasonhartman1/
Linkedin.com/in/jasonhartmaninvestor/

Call our Investment Counselors at: 1-800-HARTMAN (US) or visit: [ Ссылка ]

Free Class: Easily get up to $250,000 in funding for real estate, business or anything else: [ Ссылка ]

CYA Protect Your Assets, Save Taxes & Estate Planning:
[ Ссылка ]

Get wholesale real estate deals for investment or build a great business – Free Course: [ Ссылка ]

Special Offer from Ron LeGrand:
[ Ссылка ]

Free Mini-Book on Pandemic Investing:
[ Ссылка ]

свернуть