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Calmar Ratio Formula

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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. Check FAQs

CR = (\frac{ARR}{MDD}) \cdot - 1

CR - Calmar Ratio?ARR - Average Rate of Return?MDD - Maximum Drawdown?

Calmar Ratio Example

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Here is how the Calmar Ratio equation looks like with Values.

Here is how the Calmar Ratio equation looks like with Units.

Here is how the Calmar Ratio equation looks like.

0.24 = (\frac{12}{-50}) \cdot - 1

0.24 = (\frac{12}{-50}) \cdot - 1

0.24 = (\frac{12}{-50}) \cdot - 1

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Calmar Ratio Solution

Follow our step by step solution on how to calculate Calmar Ratio?

FIRST Step Consider the formula

CR = (\frac{ARR}{MDD}) \cdot - 1

Next Step Substitute values of Variables

∴

CR = (\frac{12}{-50}) \cdot - 1

Next Step Prepare to Evaluate

∴

CR = (\frac{12}{-50}) \cdot - 1

LAST Step Evaluate

∴

CR = 0.24

Calmar Ratio Formula Elements

Variables

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.

Symbol: CR

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Calmar Ratio

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.

Symbol: ARR

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Average Rate of Return

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.

Symbol: MDD

Measurement: NAUnit: Unitless

Note: Value can be positive or negative.

Formulas to find Maximum Drawdown

Other formulas in Risk Management category

Go Sortino Ratio

S = \frac{R p - R f}{σ d}

Go Modigliani-Modigliani Measure

M 2 = R ap - R mkt

Go Maximum Drawdown

MDD = (\frac{V trough - V peak}{V peak}) \cdot 100

Go Upside/Downside Ratio

R up/down = \frac{AI}{DI}

How to Evaluate Calmar Ratio?

Calmar Ratio evaluator uses Calmar Ratio = (Average Rate of Return/Maximum Drawdown)*-1 to evaluate 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 evaluate Calmar Ratio using this online evaluator? To use this online evaluator for Calmar Ratio, enter Average Rate of Return (ARR) & Maximum Drawdown (MDD) and hit the calculate button.

FAQs on Calmar Ratio

What is the formula to find Calmar Ratio?

The formula of Calmar Ratio is expressed as Calmar Ratio = (Average Rate of Return/Maximum Drawdown)*-1. Here is an example- 0.6 = (12/(-50))*-1.

How to calculate Calmar Ratio?

With Average Rate of Return (ARR) & Maximum Drawdown (MDD) we can find Calmar Ratio using the formula - Calmar Ratio = (Average Rate of Return/Maximum Drawdown)*-1.

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Calmar Ratio Formula

Calmar Ratio Example

Calmar Ratio Solution

Calmar Ratio Formula Elements

Other formulas in Risk Management category

How to Evaluate Calmar Ratio?

FAQs on Calmar Ratio

Variable Name