About the Treynor Ratio:

The Treynor Ratio, also known as the reward-to-volatility ratio, measures the excess return generated by a portfolio for each unit of systematic risk (beta). It is calculated as the portfolio's excess return (portfolio return minus the risk-free rate) divided by the portfolio's beta. A higher Treynor Ratio indicates better portfolio performance on a risk-adjusted basis, particularly when considering only systematic risk.