The reward-to-volatility ratio is given by ________.
A) the slope of the capital allocation line
B) the second derivative of the capital allocation line
C) the point at which the second derivative of the investor's indifference curve reaches zero
D) the portfolio's excess return

Question

Quizplus · Accepted Answer

The reward-to-volatility ratio is measured by the slope of the capital allocation line, which represents the excess return per unit of volatility (risk) of the portfolio.

The Reward-To-Volatility Ratio Is Given by ________