When determining what stock to invest or include in an investment portfolio, it is important for us to consider not only the returns of the stock but also the potential risk. In order to capture them when making investment considerations.
In 1966, William Sharpe develop a ratio called the reward-to-variability ratio.
In this project, I will be using 2016 stock data to determine which one among the three investment choices(Amazon, Facebook, and S&P 500 index fund) has a higher Sharpe ratio, therefore a better investment option.