# Sortino Ratio calculation

I've been using an Excel template to calculate the Sortino ratio for my automated trading strategies. http://investexcel.net/calculate-the-sortino-ratio-with-excel

Basically I input my monthly returns in the return column. That's 12 months of returns for each year from 2006 to 2014.

However, for one of the strategies, let's call it strat A, it had one exceptional year, which had no negative monthly returns. So when the template tries to calculate the Sortino ratio by dividing the returns by the downside risk etc it can't do the calculation because there was no downside risk. So it's dividing by 0 which messes up the calculation.

So I'm wondering what to do in such a scenario?

• Are you using discrete returns in computing the Sortino ratio? – Quantopik Apr 16 '15 at 21:31
• 2010 1.57%, 6.35%, 12.49%, 6.82%, 1.13%, 9.40%, 1.68%, 10.76%, 3.81%, 22.24%, 13.15%, 0.22%, those returns are the monthly net profits / 100,000 USD x 100 – HappySad Apr 16 '15 at 22:23