Question

Consider the following data for two investments, A and B: Investment A: x⎯⎯x¯ = 10 and...

Consider the following data for two investments, A and B:

Investment A: x⎯⎯x¯ = 10 and s = 5
Investment B: x⎯⎯x¯ = 7 and s = 3



a-1. Which investment provides the higher return?

Investment B

or

Investment A


a-2. Which investment provides less risk?

Investment B

or

Investment A


b-1. Given a risk-free rate of 1.45%, calculate the Sharpe ratio for each investment. (Round your answers to 2 decimal places.)

Sharpe ratio for investment A______

Sharpe ratio for investment B_______


b-2. Which investment provides the higher reward per unit of risk?

Investment B

or

Investment A

Math   Statistics-And-Probability   
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