The following table summarizes selected statistics for two portfolios for a 10-year period. Assume that the risk-free rate is 4% over this period. As measured by the Sharpe ratio, the fund with the superior risk-adjusted performance during this period is ________.
A) Fund A because it has a lower positive Sharpe ratio than Fund B
B) Fund B because it has a lower positive Sharpe ratio than Fund A
C) Fund A because it has a higher positive Sharpe ratio than Fund B
D) Fund B because it has a higher positive Sharpe ratio than Fund A

Question

The following table summarizes selected statistics for two portfolios for a 10-year period. Assume that the risk-free rate is 4% over this period.  As measured by the Sharpe ratio, the fund with the superior risk-adjusted performance during this period is ________.
A) Fund A because it has a lower positive Sharpe ratio than Fund B 
B) Fund B because it has a lower positive Sharpe ratio than Fund A 
C) Fund A because it has a higher positive Sharpe ratio than Fund B 
D) Fund B because it has a higher positive Sharpe ratio than Fund A

Quizplus · Accepted Answer

The Answer of The following table summarizes selected statistics for two portfolios for a 10-year period. Assume that the risk-free rate is 4% over this period.  As measured by the Sharpe ratio, the fund with the superior risk-adjusted performance during this period is ________.
A) Fund A because it has a lower positive Sharpe ratio than Fund B 
B) Fund B because it has a lower positive Sharpe ratio than Fund A 
C) Fund A because it has a higher positive Sharpe ratio than Fund B 
D) Fund B because it has a higher positive Sharpe ratio than Fund A

The Following Table Summarizes Selected Statistics for Two Portfolios for a 10-Year