• Let an investor be considering two risky portfolios: A and B to construct a complete portfolio C with a risk-free asset. The reward-to-variability ratio of portfolio A is 0.14 and reward to variability ratio of portfolio B is 0.12.

   

  Combination of portfolio B and risk-free asset will provide lower expected return for any level of risk than combination of portfolio A and risk-free asset.

  True/false

Answer rating: 100% (QA)

False The rewardtovariability ratio also known as the Sharpe ratio is a measure of the excess return ... View the full answer