UPDATE 1-IPO by Nobel winner's firm prices above range

* Prices IPO at $12/shr vs $9-$11 range-underwriter

* Sells 10.6 mln shares, raises about $127.2 mln

* Expected to trade on Nasdaq on Tuesday under "FNGN"

NEW YORK, March 15 (Reuters) - Financial Engines Inc (FNGN.O), which provides financial analysis based on the work of Nobel laureate and co-founder William Sharpe, priced shares in its initial public offering above the expected price on Monday.

Palo Alto, California-based Financial Engines sold 10.6 shares for $12 each, raising about $127.2 million. It had planned to sell 10.6 million shares for between $9 and 11 after cutting the size of its IPO from 10.9 million shares.

Financial Engines provides portfolio, investment and retirement advice. It makes money by charging fees based on the amount of assets it manages and on subscriptions.

Co-founder Sharpe jointly won the Nobel Prize in Economic Sciences in 1990 for his work on financial theory, including how assets are priced and the Sharpe ratio, which measures the relationship between risk and reward.

Sharpe currently serves as a Director Emeritus for Financial Engines and is a Professor Emeritus in Stanford's Graduate School of Business.

Financial Engines' shareholders include funds associated with venture capital investors Foundation Capital Leadership Fund and New Enterprise Associates, and private equity investor Oak Hill Capital Partners.

The company posted a 19 percent increase in revenue to $85 million in 2009. The company swung to a profit in the same period, posting net income of $5.7 million compared with a $3.6 million loss a year earlier, according to a filing with the U.S. Securities and Exchange Commission.

The company said it expects proceeds of about $52.2 million at the midpoint, which it will use for working capital.

The underwriters are being led by Goldman Sachs & Co and UBS Investment Bank. It is expected to begin trade on the Nasdaq on Tuesday under the symbol "FNGN." (Reporting by Clare Baldwin; Editing by Gary Hill)