# How do you calculate portfolio return and risk

## How do you calculate portfolio return?

ROI is calculated by

**subtracting the initial value of the investment from**the final value of the investment (which equals the net return), then dividing this new number (the net return) by the cost of the investment, then finally, multiplying it by 100.## How do you calculate portfolio risk?

Portfolio Risk — Diversification and Correlation Coefficients. Portfolio risks can be calculated, like calculating the risk of single investments, by

**taking the standard deviation of the variance of actual returns of the portfolio over time**.## How do you calculate portfolio risk and return in Excel?

## How do you calculate risk return?

Remember, to calculate risk/reward,

**you divide your net profit (the reward) by the price of your maximum risk**. Using the XYZ example above, if your stock went up to $29 per share, you would make $4 for each of your 20 shares for a total of $80. You paid $500 for it, so you would divide 80 by 500 which gives you 0.16.## How do you calculate portfolio?

**Divide the value of the specified subset of investments by the total portfolio value**to calculate the portion of the portfolio. In this example, if your tech stocks are worth $10,000 and the total portfolio is worth $50,000, divide $10,000 by $50,000 to get 0.2.