Best Buy Information Ratio

Best Buy Co Inc has current Information Ratio of 0.0644. The Information Ratio is the ratio of the alpha component of total returns to the standard deviation of these excess alpha returns. The alpha component is the return that is attributable to the manager skill to time the market and is the residual after taking out the risk free return and the beta components from the total returns. While the Sharpe ratio considers the standard deviation of the total returns, the information ratio considers the variability of only the alpha component of the return (which also forms the numerator). In other words, the information ratio is merely Jensen alpha divided by its standard deviation.
Best Buy 
INFOR 
 = 
ER[a] - ER[b] 
STD[a] 
 = 
0.0644
ER[a] =   Expected return on investing in Best Buy
ER[b] =   Expected return on market index or selected benchmark
STD[a] =   Standard Deviation of returns on Best Buy

Information Ratio Comparison

Best Buy Co Inc is rated fourth in information ratio category among related companies. It is currently under evaluation in maximum drawdown category among related companies reporting about  150.65  of Maximum Drawdown per Information Ratio. The ratio of Maximum Drawdown to Information Ratio for Best Buy Co Inc is roughly  150.65 
The higher the information ratio, the greater the chances of the manager to make money in the future. The information ratio only looks to compute the return per unit of risk undertaken for the alpha component. This is important because alpha returns are risky, as they represent a zero sum game for the market as a whole. In fact, average alpha for the market as a whole is in practice slightly less than zero because of transaction and other costs. Therefore it is easy for a manager to take on ?alpha risk? and lose money that will bite into the beta returns.
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Best Buy Co., Inc. operates as a retailer of technology products, services, and solutions in the United States, Canada, and Mexico. more
NameBest Buy Co Inc
InstrumentUSA Stock
RegionNorth America
ExchangeNew York Stock Exchange
CIK Number00764478.0
ISINUS0865161014
CUSIP086516101
Analyst Consensus
Piotroski F Score
Macroaxis Advice
Bond Rating