He is the STANCO 25 Professor of Finance, Emeritus at Stanford University's Graduate School of Business, and the winner of the 1990 Nobel Memorial Prize in Economic Sciences.

He created the Sharpe ratio for risk-adjusted investment performance analysis, and he contributed to the development of the binomial method for the valuation of options, the gradient method for asset allocation optimization, and returns-based style analysis for evaluating the style and performance of investment funds.

As his father was in the National Guard, the family moved several times during World War II, until they finally settled in Riverside, California.

[1] However, in the first year he decided to change his focus and moved to the University of California, Los Angeles to study business administration.

While teaching at Stanford, Sharpe continued research in the field of investments, in particular on portfolio allocation and pension funds.

He also became directly involved in the investment process by offering consultance to Merrill Lynch and to Wells Fargo, thus having the opportunity to put in practice the prescriptions of financial theory.

[7] In 1989 he retired from teaching, retaining the position of Professor Emeritus of Finance at Stanford, choosing to focus on his consulting firm, now named William F. Sharpe Associates.

In 1996, he co-founded Financial Engines (NASDAQ: FNGN) with Stanford Professor Joseph Grundfest and Silicon Valley lawyer Craig W.