Chee Chews portfolio has a beta of 1 3 and earned a return of 12 9 during the year just ended The risk free rate is currently 7 8 The return on the market portfolio during the year just ended was 11 0 a Calculate Jensens measure (Jensens alpha) for Chees portfolio for the year just ended b Compare ...

a Jensens measure JM Total portfolio return Riskfree rate Portfo ...

Chee Chews portfolio has a beta of 1.3 and earned a return of 12.9% during the year

Question:

Chee Chew’s has a beta of 1.3 and earned a return of 12.9% during the year just ended. The risk-free rate is currently 7.8%. The return on the market during the year just ended was 11.0%.
a. Calculate Jensen’s measure (Jensen’s alpha) for Chee’s for the year just ended.
b. Compare the performance of Chee’s found in part a to that of Carri Uhl’s which has a Jensen’s measure of – 0.24. Which performed better? Explain.
c. Use your findings in part a to discuss the performance of Chee’s during the period just ended.
Portfolio
A portfolio is a grouping of financial assets such as stocks, bonds, commodities, currencies and cash equivalents, as well as their fund counterparts, including mutual, exchange-traded and closed funds. A portfolio can also consist of non-publicly...