RiskGrades - RG

RiskGrades - RG
A trademarked method for calculating the risk of an asset portfolio. RiskGrades are based on a variance-covariance approach that measures the volatility of assets or asset portfolios as the scaled standard deviations of the returns.

More complex RiskGrades calculations allow for a few additional concepts:

RiskGrades (RG)

RiskGrades were developed by JPMorgan. You can use RiskGrades to determine the level of risk in your portfolio based on the following numbers:

  • The RG of a risk-free asset is expected to be 0
  • The RG of a low-risk asset is expected to be 0 - 100
  • Normal stocks/indexes should have an RG of 100 - 300
  • Stocks with an RG of 100 - 800 are considered high risk
  • IPOs have an RG greater than 800

  • Investment dictionary. . 2012.

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