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The Table Below Gives Statistics Relating to a Hypothetical 10-Year

Question 80

Multiple Choice

The table below gives statistics relating to a hypothetical 10-year record of two portfolios. Assume other statistics relating to these portfolios are the same and the risk-free rate is 3.5%. The table below gives statistics relating to a hypothetical 10-year record of two portfolios. Assume other statistics relating to these portfolios are the same and the risk-free rate is 3.5%.   Using the coefficient of variation and the Sharpe ratio, the fund that is preferred in terms of relative risk and return per unit of risk is ________. A)  Portfolio A because it has a higher coefficient of variation and a lower Sharpe ratio B)  Portfolio A because it has a lower coefficient of variation and a higher Sharpe ratio C)  Portfolio B because it has a higher coefficient of variation and a lower Sharpe ratio D)  Portfolio B because it has a lower coefficient of variation and a higher Sharper ratio Using the coefficient of variation and the Sharpe ratio, the fund that is preferred in terms of relative risk and return per unit of risk is ________.


A) Portfolio A because it has a higher coefficient of variation and a lower Sharpe ratio
B) Portfolio A because it has a lower coefficient of variation and a higher Sharpe ratio
C) Portfolio B because it has a higher coefficient of variation and a lower Sharpe ratio
D) Portfolio B because it has a lower coefficient of variation and a higher Sharper ratio

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