Because all the measures of portfolio performance except the reward-to-variability ratio, require the identification of a _____ surrogate, whatever is used can be criticized as being inadequate.
A) security market
B) capital market
C) market portfolio
D) market volatility

Question

Quizplus · Accepted Answer

All measures of portfolio performance except the reward-to-variability ratio require the identification of a market portfolio. The market portfolio is a theoretical construct representing a diversified portfolio of all investable assets in the market. However, the selection of which assets to include in the market portfolio can be criticized as being inadequate, as different investors may have different preferences and constraints.

Because All the Measures of Portfolio Performance Except the Reward-To-Variability