In this module you will learn about the risk/return relationship and ways to manage investment risk in a portfolio. The elements of, and measurement tools for, total risk, systematic risk and unsystematic risk will be defined. We will demonstrate the use of standard deviation and beta to measure investment risk and apply the capital asset pricing model to calculate a required return. Portfolio diversification concepts will be demonstrated and we will then conclude with calculating risk adjusted returns using the Jenson, Treynor and Sharpe performance indexes.

Author: Craig Kinnunen, MS, CFP®

Craig Kinnunen, MS, CFP®is an associate professor at the College for Financial Planning. Prior to joining the College, Craig enjoyed a long and successful career in personal financial planning and wealth management. Craig’s enthusiasm for financial planning extends beyond the classroom, as he also spends time providing pro bono financial education and individual financial counseling to members of the Colorado National Guard. Craig earned a bachelor of science degree in accounting from Northern Michigan University and followed that up with a master of science degree in finance from the University of Colorado in Denver. You can contact Craig at

Complexity Level: Intermediate