{"id":9981,"date":"2023-11-20T16:53:02","date_gmt":"2023-11-20T11:23:02","guid":{"rendered":"https:\/\/www.tickertape.in\/glossary\/?p=9981"},"modified":"2023-11-20T16:53:04","modified_gmt":"2023-11-20T11:23:04","slug":"tracking-error-importance-how-to-calculate-and-limitations","status":"publish","type":"post","link":"https:\/\/www.tickertape.in\/glossary\/tracking-error-importance-how-to-calculate-and-limitations\/","title":{"rendered":"Tracking Error &#8211; Importance, How To Calculate and Limitations"},"content":{"rendered":"\n<p>Investors use various tools to measure risk and return from <a href=\"https:\/\/www.tickertape.in\/glossary\/investment-meaning-types-how-to-invest-and-savings-vs-investments\/\">investment<\/a> vehicles. Tracking error is the difference between how a portfolio performs compared to a benchmark. It&#8217;s expressed as a percentage, representing the standard deviation of this difference. Investors use tracking error to assess how well an investment matches the benchmark&#8217;s return, serving as a measure of consistency over time in relation to the benchmark. <\/p>\n\n\n\n<p>To know more about tracking error and how it is calculated, read further.&nbsp;<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_22 counter-hierarchy counter-numeric\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\">You will Learn About: <\/p>\n<span class=\"ez-toc-title-toggle\"><a class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" style=\"display: none;\"><i class=\"ez-toc-glyphicon ez-toc-icon-toggle\"><\/i><\/a><\/span><\/div>\n<nav><ul class=\"ez-toc-list ez-toc-list-level-1\"><li class=\"ez-toc-page-1 ez-toc-heading-level-2\"><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.tickertape.in\/glossary\/tracking-error-importance-how-to-calculate-and-limitations\/#What-is-a-tracking-error\" title=\"What is a tracking error?\">What is a tracking error?<\/a><\/li><li class=\"ez-toc-page-1 ez-toc-heading-level-2\"><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.tickertape.in\/glossary\/tracking-error-importance-how-to-calculate-and-limitations\/#Tracking-Error-Important-Points-To-Note\" title=\"Tracking Error &#8211; Important Points To Note\">Tracking Error &#8211; Important Points To Note<\/a><\/li><li class=\"ez-toc-page-1 ez-toc-heading-level-2\"><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.tickertape.in\/glossary\/tracking-error-importance-how-to-calculate-and-limitations\/#Factors-that-affect-tracking-error\" title=\"Factors that affect tracking error\">Factors that affect tracking error<\/a><\/li><li class=\"ez-toc-page-1 ez-toc-heading-level-2\"><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.tickertape.in\/glossary\/tracking-error-importance-how-to-calculate-and-limitations\/#Importance-of-tracking-error\" title=\"Importance of tracking error&nbsp;\">Importance of tracking error&nbsp;<\/a><\/li><li class=\"ez-toc-page-1 ez-toc-heading-level-2\"><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.tickertape.in\/glossary\/tracking-error-importance-how-to-calculate-and-limitations\/#How-to-calculate-tracking-error\" title=\"How to calculate tracking error?\">How to calculate tracking error?<\/a><\/li><li class=\"ez-toc-page-1 ez-toc-heading-level-2\"><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/www.tickertape.in\/glossary\/tracking-error-importance-how-to-calculate-and-limitations\/#What-are-some-of-the-limitations-of-tracking-error\" title=\"What are some of the limitations of tracking error?\">What are some of the limitations of tracking error?<\/a><\/li><li class=\"ez-toc-page-1 ez-toc-heading-level-2\"><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/www.tickertape.in\/glossary\/tracking-error-importance-how-to-calculate-and-limitations\/#Conclusion\" title=\"Conclusion\">Conclusion<\/a><\/li><li class=\"ez-toc-page-1 ez-toc-heading-level-2\"><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/www.tickertape.in\/glossary\/tracking-error-importance-how-to-calculate-and-limitations\/#FAQs\" title=\"FAQs\">FAQs<\/a><\/li><\/ul><\/nav><\/div>\n<h2><span class=\"ez-toc-section\" id=\"What-is-a-tracking-error\"><\/span><strong>What is a<\/strong><strong> tracking error<\/strong><strong>?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Tracking error is a measure of the difference between an investment portfolio\u2019s returns and the benchmark index it was meant to beat. Tracking error is also described as a standard deviation percentage gap that reports the difference between the returns an investor gains and the benchmark they were planning to surpass.&nbsp;<\/p>\n\n\n\n<p>In a perfect world, it would be preferable if the tracking error or active risk was low or moderate. If this number is high, regardless of performance, it indicates that the portfolio manager has taken a higher-than-appropriate risk.<\/p>\n\n\n\n<p>Tracking error<em> <\/em>is mainly associated with passive investment vehicles. It helps to gauge the performance of <a href=\"https:\/\/www.tickertape.in\/glossary\/mutual-fund-meaning\/\">mutual funds<\/a>, hedge funds, or Exchange-traded Funds (ETFs).<\/p>\n\n\n\n<div class=\"wp-block-uagb-advanced-heading uagb-block-df467334\"><h2 class=\"uagb-heading-text\"><span class=\"ez-toc-section\" id=\"Tracking-Error-Important-Points-To-Note\"><\/span>Tracking Error &#8211; Important Points To Note<span class=\"ez-toc-section-end\"><\/span><\/h2><\/div>\n\n\n\n<ul>\n<li>Tracking error can be defined as the difference between an investment portfolio\u2019s returns and the index it mimics.&nbsp;&nbsp;<\/li>\n\n\n\n<li>Tracking error is a handy measurement of how well a fund is being managed, the potential risks for investors, and the performance of portfolio managers.<\/li>\n\n\n\n<li>The higher the tracking error, the more the portfolio manager diverges from the benchmark. The lower the tracking error, the closer the portfolio manager follows the benchmark.<\/li>\n<\/ul>\n\n\n\n<h2><span class=\"ez-toc-section\" id=\"Factors-that-affect-tracking-error\"><\/span><strong>Factors that affect <\/strong><strong>tracking error<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>There are factors that determine a portfolio\u2019s tracking error; some of which include:<\/p>\n\n\n\n<ul>\n<li>Number of stocks in the portfolio<\/li>\n\n\n\n<li>Differences in market capitalisation, investment style, timing, and other characteristics of the portfolio&nbsp;<\/li>\n\n\n\n<li>Change of index constituents<\/li>\n\n\n\n<li>Corporate actions<\/li>\n\n\n\n<li>Market <a href=\"https:\/\/www.tickertape.in\/glossary\/volatility-meaning-calculation-importance-and-types\/\">volatility<\/a><\/li>\n\n\n\n<li>The management fees, brokerage costs, custodial fees, and other expenses affecting the investment portfolio that don\u2019t affect the benchmark<\/li>\n\n\n\n<li>The portfolio\u2019s <a href=\"https:\/\/www.tickertape.in\/glossary\/beta\/\">beta<\/a><\/li>\n<\/ul>\n\n\n\n<h2><span class=\"ez-toc-section\" id=\"Importance-of-tracking-error\"><\/span><strong>Importance of <\/strong><strong>tracking error<\/strong><strong>&nbsp;<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Tracking error is crucial for assessing a portfolio\u2019s performance and the ability of a fund manager to garner excessive returns and outdo the benchmark. Additionally, this is why tracking error is important:<\/p>\n\n\n\n<ul>\n<li>Tracking error helps measure and compare a portfolio&#8217;s performance with the respective index or benchmark.<\/li>\n\n\n\n<li>It helps to recognise the consistency of higher returns.<\/li>\n\n\n\n<li>Portfolio managers leverage tracking errors to determine how close an investment portfolio is to its benchmark.<\/li>\n\n\n\n<li>With the help of tracking errors, investors get a chance to ascertain how reliable a fund manager\u2019s investment strategy is.<\/li>\n<\/ul>\n\n\n\n<p>Ultimately, tracking error is a strong indicator of a portfolio manager\u2019s proficiency and a reflection of how well the portfolio is managed.&nbsp;<\/p>\n\n\n\n<p>For instance, actively managed portfolios carry high risk. On the other hand, passively managed portfolios replicate index funds, and thus a large tracking error is considered unpleasant for such investors. Hence, tracking errors can be leveraged as a tool to set acceptable performance benchmarks for fund managers.&nbsp;<\/p>\n\n\n\n<p>You can also use <a href=\"https:\/\/www.tickertape.in\/screener\/mutual-fund\" target=\"_blank\" rel=\"noreferrer noopener\">Tickertape&#8217;s Mutual Fund Screener<\/a> to analyse the performance of a fund. There are more than 50+ filters that help you to determine the best fund. <\/p>\n\n\n\n<h2><span class=\"ez-toc-section\" id=\"How-to-calculate-tracking-error\"><\/span><strong>How to calculate <\/strong><strong>tracking error<\/strong><strong>?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>There are various ways to measure <strong>tracking errors<\/strong><strong>. <\/strong>The first method involves subtracting the benchmark\u2019s cumulate returns from the portfolio\u2019s returns. The tracking error formula for this method is:<\/p>\n\n\n\n<p><strong>Tracking error = Return(p) \u2013 Return(i)<\/strong><\/p>\n\n\n\n<p>Where;<\/p>\n\n\n\n<p>p = portfolio&nbsp;<\/p>\n\n\n\n<p>i = index or benchmark<\/p>\n\n\n\n<p>Let\u2019s understand the concept of tracking error with the help of an example. Let\u2019s say that ABC Fund is supposed to track Sensex. The previous year, the Sensex returned 10%, while the ABC Fund returned 9.7%. The difference between the two: 9.7% &#8211; 10% = -0.3% is the tracking error.&nbsp;<\/p>\n\n\n\n<p>The second method, on the other hand, is way more common and offers a more accurate calculation, which includes calculating the standard deviation of the difference in the portfolio, as well as benchmarks returns, over time. Here\u2019s how to calculate tracking error<strong> <\/strong>using the second method:<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img decoding=\"async\" loading=\"lazy\" width=\"330\" height=\"114\" src=\"https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/image-6.png\" alt=\"\" class=\"wp-image-9984\" srcset=\"https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/image-6.png 330w, https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/image-6-300x104.png 300w\" sizes=\"(max-width: 330px) 100vw, 330px\" \/><figcaption class=\"wp-element-caption\">Image source: https:\/\/study.com\/<\/figcaption><\/figure>\n\n\n\n<p>Here, TE = Tracking error<\/p>\n\n\n\n<p>Rp = Return of portfolio<\/p>\n\n\n\n<p>Rb = Return of benchmark<\/p>\n\n\n\n<p>N = Number of return periods<\/p>\n\n\n\n<p>In this case, let\u2019s assume the following returns for the ABC Fund and Sensex:<\/p>\n\n\n\n<ul>\n<li>Sensex (10%, 5%, 7%, 2%, 8%)<\/li>\n\n\n\n<li>ABC Fund (9.7%, 4.6%, 7.2%, 2.2%, 7.8%)<\/li>\n<\/ul>\n\n\n\n<p>But how do we locate the tracking error on the basis of this information?<\/p>\n\n\n\n<p>First, we calculate the simple tracking error of every period by subtracting Sensex\u2019s performance from ABC Fund\u2019s performance. These are the values we will attain (-0.3%, -0.4%, 0.2%, 0.2%, -0.2%). We then square each value (0.09%, 0.16%, 0.04%, 0.04%, 0.04%). Then, we do a total of these five values, which rounds up to 0.37%. The next step is to divide the sum by N \u2013 1 or (5-1) = 0.0925%.&nbsp;<\/p>\n\n\n\n<p>Lastly, we do the square root of 0.0925% to identify the tracking error, which comes to<strong> <\/strong>0.304% in this case.<\/p>\n\n\n\n<p>You can also use Tickertape to find the tracking error of a fund. Launch the <a href=\"https:\/\/www.tickertape.in\/screener\/mutual-fund\" target=\"_blank\" rel=\"noreferrer noopener\">Mutual Fund Screener<\/a> and search for &#8216;Tracking Error&#8217; in &#8216;Add Filter&#8217;.<\/p>\n\n\n\n<h2><span class=\"ez-toc-section\" id=\"What-are-some-of-the-limitations-of-tracking-error\"><\/span><strong>What are some of the limitations of<\/strong><strong> tracking error<\/strong><strong>?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Typically, investors may accept high tracking errors if a fund&#8217;s performance is excellent. However, the same may not be true if returns are low. In that sense, viewing tracking errors in isolation can misguide an investor because, at the end of the day, several factors need to be considered when viewing a fund&#8217;s performance.<\/p>\n\n\n\n<p>Distinguishing between funds based on tracking error alone may not be wise.<\/p>\n\n\n\n<h2><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span><strong>Conclusion<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Although rarely given importance, track errors can significantly impact an investor\u2019s returns. Conceptually, if an index fund holds a high tracking error, it defeats the purpose of index investing. So, when choosing an Index fund, go for a fund with a low tracking error. As an investor, you must investigate tracking errors to determine your true returns.&nbsp;<\/p>\n\n\n\n<h2><span class=\"ez-toc-section\" id=\"FAQs\"><\/span><strong>FAQs<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<div class=\"wp-block-uagb-faq uagb-faq__outer-wrap uagb-block-92545f31 uagb-faq-icon-row uagb-faq-layout-accordion uagb-faq-expand-first-true uagb-faq-inactive-other-true uagb-faq__wrap uagb-buttons-layout-wrap uagb-faq-equal-height\" data-faqtoggle=\"true\" role=\"tablist\">\n<div class=\"wp-block-uagb-faq-child uagb-faq-child__outer-wrap uagb-faq-item uagb-block-b9522ac9\" role=\"tab\" tabindex=\"0\"><div class=\"uagb-faq-questions-button uagb-faq-questions\"><span class=\"uagb-icon uagb-faq-icon-wrap\"><svg xmlns=\"https:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 448 512\"><path d=\"M432 256c0 17.69-14.33 32.01-32 32.01H256v144c0 17.69-14.33 31.99-32 31.99s-32-14.3-32-31.99v-144H48c-17.67 0-32-14.32-32-32.01s14.33-31.99 32-31.99H192v-144c0-17.69 14.33-32.01 32-32.01s32 14.32 32 32.01v144h144C417.7 224 432 238.3 432 256z\"><\/path><\/svg><\/span><span class=\"uagb-icon-active uagb-faq-icon-wrap\"><svg xmlns=\"https:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 448 512\"><path d=\"M400 288h-352c-17.69 0-32-14.32-32-32.01s14.31-31.99 32-31.99h352c17.69 0 32 14.3 32 31.99S417.7 288 400 288z\"><\/path><\/svg><\/span><span class=\"uagb-question\"><strong>What is a good tracking error for index funds?<\/strong><\/span><\/div><p class=\"uagb-faq-content\">In an ideal case scenario, an index fund must have a tracking error of zero when comparing performance to its benchmark. But in reality, index funds lean towards the 1%, -2% range.<\/p><\/div>\n\n\n\n<div class=\"wp-block-uagb-faq-child uagb-faq-child__outer-wrap uagb-faq-item uagb-block-e64e6411\" role=\"tab\" tabindex=\"0\"><div class=\"uagb-faq-questions-button uagb-faq-questions\"><span class=\"uagb-icon uagb-faq-icon-wrap\"><svg xmlns=\"https:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 448 512\"><path d=\"M432 256c0 17.69-14.33 32.01-32 32.01H256v144c0 17.69-14.33 31.99-32 31.99s-32-14.3-32-31.99v-144H48c-17.67 0-32-14.32-32-32.01s14.33-31.99 32-31.99H192v-144c0-17.69 14.33-32.01 32-32.01s32 14.32 32 32.01v144h144C417.7 224 432 238.3 432 256z\"><\/path><\/svg><\/span><span class=\"uagb-icon-active uagb-faq-icon-wrap\"><svg xmlns=\"https:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 448 512\"><path d=\"M400 288h-352c-17.69 0-32-14.32-32-32.01s14.31-31.99 32-31.99h352c17.69 0 32 14.3 32 31.99S417.7 288 400 288z\"><\/path><\/svg><\/span><span class=\"uagb-question\"><strong>Is tracking error important?<\/strong><\/span><\/div><p class=\"uagb-faq-content\">Yes, tracking error is an important measure as it tells the difference between the performance of a <a href=\"https:\/\/www.tickertape.in\/glossary\/stock\/\">stock<\/a> mutual fund and its benchmark. With this, tracking error also indicates how well a portfolio manager is handling the portfolio and their ability to generate returns.<\/p><\/div>\n\n\n\n<div class=\"wp-block-uagb-faq-child uagb-faq-child__outer-wrap uagb-faq-item uagb-block-db2b3a30\" role=\"tab\" tabindex=\"0\"><div class=\"uagb-faq-questions-button uagb-faq-questions\"><span class=\"uagb-icon uagb-faq-icon-wrap\"><svg xmlns=\"https:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 448 512\"><path d=\"M432 256c0 17.69-14.33 32.01-32 32.01H256v144c0 17.69-14.33 31.99-32 31.99s-32-14.3-32-31.99v-144H48c-17.67 0-32-14.32-32-32.01s14.33-31.99 32-31.99H192v-144c0-17.69 14.33-32.01 32-32.01s32 14.32 32 32.01v144h144C417.7 224 432 238.3 432 256z\"><\/path><\/svg><\/span><span class=\"uagb-icon-active uagb-faq-icon-wrap\"><svg xmlns=\"https:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 448 512\"><path d=\"M400 288h-352c-17.69 0-32-14.32-32-32.01s14.31-31.99 32-31.99h352c17.69 0 32 14.3 32 31.99S417.7 288 400 288z\"><\/path><\/svg><\/span><span class=\"uagb-question\"><strong>Is high tracking error a good sign?<\/strong><\/span><\/div><p class=\"uagb-faq-content\">No, high tracking errors are not ideal. The higher the tracking error, the more the fund manager deviates from the benchmark. The lower it is, the closer the fund manager is to following the benchmark. This is true in case of index funds while an active portfolio having a low tracking error is an issue as the investor will end up paying higher fees, usually associated with active management, and get the returns of an index which isn\u2019t ideal. Rather than a straight no, a more apt answer would be based on the investors context.<\/p><\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Tracking error is an important metric that Investors use to assess how well an investment performs against the benchmark&#8217;s return.<\/p>\n","protected":false},"author":96,"featured_media":9986,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"spay_email":""},"categories":[1],"tags":[],"jetpack_featured_media_url":"https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1.png","uagb_featured_image_src":{"full":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1.png",2086,1086,false],"thumbnail":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-150x150.png",150,150,true],"medium":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-300x156.png",300,156,true],"medium_large":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1.png",768,400,false],"large":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-1024x533.png",770,401,true],"1536x1536":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-1536x800.png",1536,800,true],"2048x2048":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-2048x1066.png",2048,1066,true],"authorship-box-avatar":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-150x150.png",150,150,true],"authorship-box-related":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-70x70.png",70,70,true],"post-thumbnail":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-270x180.png",270,180,true],"contentberg-main":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-770x515.png",770,515,true],"contentberg-main-full":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-1170x508.png",1170,508,true],"contentberg-slider-stylish":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-900x515.png",900,515,true],"contentberg-slider-carousel":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-370x370.png",370,370,true],"contentberg-slider-grid-b":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-554x466.png",554,466,true],"contentberg-slider-grid-b-sm":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-306x466.png",306,466,true],"contentberg-slider-bold-sm":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-150x150.png",150,150,true],"contentberg-grid":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-370x245.png",370,245,true],"contentberg-list":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-260x200.png",260,200,true],"contentberg-list-b":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-370x305.png",370,305,true],"contentberg-thumb":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-87x67.png",87,67,true],"contentberg-thumb-alt":["https:\/\/www.tickertape.in\/glossary\/wp-content\/uploads\/2023\/02\/02-1-150x150.png",150,150,true]},"uagb_author_info":{"display_name":"Nikitha","author_link":"%3Fmolongui_byline=true%26mca="},"uagb_comment_info":1,"uagb_excerpt":"Tracking error is an important metric that Investors use to assess how well an investment performs against the benchmark's return.","_links":{"self":[{"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/posts\/9981"}],"collection":[{"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/users\/96"}],"replies":[{"embeddable":true,"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/comments?post=9981"}],"version-history":[{"count":4,"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/posts\/9981\/revisions"}],"predecessor-version":[{"id":10736,"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/posts\/9981\/revisions\/10736"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/media\/9986"}],"wp:attachment":[{"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/media?parent=9981"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/categories?post=9981"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.tickertape.in\/glossary\/wp-json\/wp\/v2\/tags?post=9981"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}