The best performance measure overall is:
A) the Treynor ratio.
B) the raw return.
C) the Sharpe ratio.
D) Jensen's alpha.
E) There is no best performance measure in all situations.

Question

Quizplus · Accepted Answer

Different performance measures are best suited for different situations, depending on factors such as the type of investment, the risk tolerance of the investor, and the market conditions. Each measure (Treynor ratio, raw return, Sharpe ratio, Jensen's alpha) has its own strengths and is designed to evaluate different aspects of an investment's performance.

The Best Performance Measure Overall Is