. CMLink @ 95% ... vast uroransures summyay unresolved problems will be brought to the lecturer for further attention 07:16 Wk5 - Portfolio Theory.pdf X On Capital Allocation to Risky Assets 1. Which of the following choices hest completes the following statement explain As with a higher degree of a compared with a dee, will prefer men portfolios with higher premium that are risker with higher standard devices with lower Share to with higher Share None of the above is true Hint: in finance, Sharpe ratio is a way to examine the performance of an investment by adjusting for its risk. The ratio measures the excess return for risk premium) per unit of deviation in an investment asset or a trading strategy, typically referred to as risk. Sharpe ratio is defined as ER-R1 S. where is the asset return, R is the return on a benchmark asset, such as the risk free rate of return, IR-R is the expected value of the excess of the asset return over the benchmark return, and is the standard deviation of the asset excess return. 21. Consider the following information whout a risky portfolio that you manage and a risk-free Your client wants to invest a proto of her investment budget in your sky fundo provide an expected rate of return on her brail or complete fo t o . What proportion should she invest in the risky pro and what part in the risk free What will be the standard deviation of the rate of mother part Another client want the highest return possible subject to the constraint that you limit his standard deviation to be no more than 125. Which client is m erikane