RE$-$POST:

You and a prospective client are considering the measurement of investment perfor

$-$

mance, particularly with respect to international portfolios for the past five years. The data you discussed are presented in the following table:

International Manager or Index Total Return Country and Security Return Currency Return

Manager A

$-$

$6$

$\%$

$2$

$\%$

$-$

$8$

$\%$

Manager B

$-$

$2$

$-$

$1$

$-$

$1$

International index

$-$

$5$

$2$

$-$

$5$

$.$

$2$

a

$)$

$$Assume that the data for manager A and manager B accurately reflect their invest

$-$

ment skills and that both managers actively manage currency exposure. Briefly describe one strength and one weakness for each manager.

b

$)$

$$R ecommend and justify a strategy that would enable your fund to take advantage of the strengths of each of the two managers while minimizing their weaknesses.