Question: Use the following information to answer questions a. - e. Fund or Asset Return% Standard Deviation% Beta Alpha% Sharpe Ratio Risk-Free 1.5 0 0 N.A

Use the following information to answer questions a. - e.

Fund or Asset	Return%	Standard Deviation%	Beta	Alpha%	Sharpe Ratio
Risk-Free	1.5	0	0	N.A	N.A
Market	9	18	1	0	0.389
Fund A	6	14	0.6	1.3	0.286
Fund B	11	22	1.3	?	?

a. What is the alpha for fund B?

b. Based on alpha, which fund displays superior performance?

c. What is the Sharpe ratio for fund B?

d. Based on the Sharpe ratio, which fund displays superior performance?

e. Suppose you were using this information to recommend a portfolio to your client. What additional evidence would make you more confident that the fund you recommend has the ability to achieve superior perform in the future? (Hint: The answer has nothing to do with the Treynor Index.)

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