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Sharpe Ratio

The Sharpe Ratio provides a great metric for backtesting performance. However, after backtesting with only one trade, I saw the Sharpe Ratio was 1.64. Knowing that the ratio requires Standard Deviation, how did it compute the ratio with only one trade?
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Welcome @Matthew! Statistics are calculated here. Sharpe ratio is calculated many different ways but we've chosen to use deviation of daily performance (daily equity delta).

Each day the start & finish values of equity are used to calculate a performance for the day. Over hundreds of days we find the deviation & then sharpe ratio. The risk free rate is zero which isn't perfect but makes it unsubjective.

The 1.64 is only because the backtest was from 2014-2015 -- its been very steady the last couple of years!
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The material on this website is provided for informational purposes only and does not constitute an offer to sell, a solicitation to buy, or a recommendation or endorsement for any security or strategy, nor does it constitute an offer to provide investment advisory services by QuantConnect. In addition, the material offers no opinion with respect to the suitability of any security or specific investment. QuantConnect makes no guarantees as to the accuracy or completeness of the views expressed in the website. The views are subject to change, and may have become unreliable for various reasons, including changes in market conditions or economic circumstances. All investments involve risk, including loss of principal. You should consult with an investment professional before making any investment decisions.


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