---
type: Metric
title: "PRAAMS Ratio"
description: "One number combining six return factors and six risk factors of a stock, bond or ETF, each scored from 1 to 7 against peers."
resource: "https://praa.ms/en/how-it-works"
tags: [praams-ratio, risk, return, metric]
generated: { by: claude/opus-5.5, at: 2026-10-19T00:00:00Z }
status: stable
sources:
  - id: praams-home
    resource: https://praa.ms/en
    title: "PRAAMS Personal homepage"
  - id: praams-how-it-works
    resource: https://praa.ms/en/how-it-works
    title: "How PRAAMS Personal works"
  - id: praams-docs
    resource: https://docs.praa.ms/
    title: "PRAAMS Ratio documentation"
---

# PRAAMS Ratio

The PRAAMS Ratio summarises the risk and return of an asset in one number, so a stock, a bond and an ETF can be compared on the same scale.

Each asset receives a score from 1 to 7 on twelve factors, compared with its peers:

- Return factors: [Valuation](../factors/valuation.md), [Performance](../factors/performance.md), [Analyst / Market view](../factors/analyst-market-view.md), [Profitability](../factors/profitability.md), [Growth](../factors/growth.md), [Dividends / Coupons](../factors/dividends-coupons.md)
- Risk factors: [Default risk](../factors/default-risk.md), [Volatility](../factors/volatility.md), [Stress-test](../factors/stress-test.md), [Selling difficulty](../factors/selling-difficulty.md), [Country risk](../factors/country-risk.md), [Other risks](../factors/other-risks.md)

Methodology: https://docs.praa.ms/

Used in [PRAAMS Personal](./praams-personal.md).