The Treynor ratio differs from the Sharpe ratio by using:
✓ Correct Answer: Option B
Treynor ratio = (Rp − Rf) / βp. It measures return per unit of systematic risk, unlike Sharpe which uses total risk.
Treynor ratio = (Rp − Rf) / βp. It measures return per unit of systematic risk, unlike Sharpe which uses total risk.