Two investment advisers are comparing performance. One averaged a 16.45% rate of return and the other a 19.78% rate of return. However, the β of the first investor was 1.5, whereas that of the second investor was 1.
Required: Suppose that the T-bill rate was 3% and the market return during the period was 15%. Aside from the issue of general movements in the market, outline the difference between the superior and inferior portfolios.
Answer% Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places (for example: 28.31%).
Get Answers For Free
Most questions answered within 1 hours.