When it comes to investing, there are a lot of different ways to measure success. One common metric is the Information Ratio, or IR. The IR measures how much your portfolio returns exceed the returns of a benchmark index like the S&P 500, relative to the volatility of those returns. In other words, it tells you how much bang you're getting for your buck in terms of risk-adjusted returns.Generally speaking, a higher IR is better than a lower one. That's because it means you're generating more return per unit of risk taken on. And that can help you achieve your financial goals more efficiently and with less stress along the way.Of course, past performance is no guarantee of future results. So even if your portfolio has an enviable information ratio today, there's no guarantee that will continue in perpetuity. But as long as you keep monitoring and adjusting accordingly, an high information ratio can be a valuable tool in helping you build wealth over time."
