Facts

• Stock performance typically relates to the rise in price of a company's stock. This generates a return on investment for investors. A common performance tracking tool is technical analysis, which looks at historical and current price charts to determine the expected growth in the stock price.
  
  

Features

• Performance and risk coincide with a company and its stock price. The Treynor ratio measures a portfolio's average return with the portfolio's non-diversifiable risk. In short, the formula calculates an indicator that if high means the performance of the portfolio is worth the risk when compared to a risk-free investment, such as a Treasury bond.
  
  

Considerations

• Investors should always look at the company behind the stock. Although the stock price may be low or declining, it does not necessarily mean the stock has higher risk compared to other investments. It simply means the company is undervalued and should reverse the declining trend in the future.