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MAR Ratio

What does MAR Ratio mean?

Managed Account Reports Ratio (MAR Ratio) is a measure of returns adjusted for risk. MAR is a ratio of the compound annual growth rate (CAGR) of a fund since inception by its biggest drawdown percentage. The higher ratio indicates the better the risk-adjusted returns.

Futures Knowledge Explains MAR Ratio

For example, a fund manager has a CAGR of 30% and at one time had a maximum drawdown of 15% since its inception then his MAR Ratio would be 30/15 = 2. MAR is used to compare the performance of commodity trading advisors, hedge funds and trading strategies. The ratio is one of the metrics used to intuitively summarize the severity of expected drawdowns. This ratio has been developed by the Managed Accounts Report newsletter so this is called MAR Ratio.

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