> For the complete documentation index, see [llms.txt](https://excelhelp.windhamlabs.com/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://excelhelp.windhamlabs.com/functions/exposure-to-loss/sortinoratio.md).

# SORTINORATIO

## Description

The Sortino ratio measures the risk-adjusted return of an instrument (or portfolio) normalized by its downside deviation. This ratio is often considered a variant of the Sharpe ratio as it only considers downside risk. This is useful for investors and analysts to assess an investment's performance under undesirable volatility environments.

## Syntax

The following describes the function signature for use in Microsoft Excel's formula bar.

```excel-formula
=SORTINORATIO(returns, threshold)
```

### Input(s)

| Argument      | Description                                                                   |
| ------------- | ----------------------------------------------------------------------------- |
| **returns**   | Required. Time series or matrix of instrument returns.                        |
| **threshold** | Optional. Return threshold. If the argument is not defined, it will use zero. |

### Output(s)

Vector of Sortino ratio estimate(s).

## Example

![](/files/-MLEMdI8FuGd3wDtvDzD)

{% file src="/files/-MLEMhFMH7RCi9SNZIt\_" %}
Example Workbook: RATIOS
{% endfile %}