Ch 2 · Security Analysis & Portfolio Management

🧮 Formula sheet

1. 1.Portfolio Return = Σ Wi × Ri
2. 2.Portfolio Variance σp² = w1²σ1² + w2²σ2² + 2w1w2 ρ σ1σ2
3. 3.Beta = Cov(Ri, Rm) / Var(Rm)
4. 4.Sharpe = (Rp − Rf)/σp; Treynor = (Rp − Rf)/β; Jensen α = Rp − [Rf + β(Rm − Rf)]