You have $25,000 invested in two mutual funds with the following characteristics: Mutual Fund A Mutual...

  

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You have $25,000 invested in two mutual funds with the following characteristics: Mutual Fund A Mutual Fund B Amount Invested $ 10,000 $15,000 Expected Return 14% 12% Standard Deviation 25% 15% Beta 1.95 1.37 Correlation (PAB) 0.32 Risk-Free Rate 3.00% (A) Please calculate this portfolio's Sharpe Ratio. (B) Please calculate this portfolio's Treynor Ratio. (C) Based on the above, should you change the amounts you have invested in Fund A and Fund B (keeping your total investment at $25,000). Why or why not? You have $25,000 invested in two mutual funds with the following characteristics: Mutual Fund A Mutual Fund B Amount Invested $ 10,000 $15,000 Expected Return 14% 12% Standard Deviation 25% 15% Beta 1.95 1.37 Correlation (PAB) 0.32 Risk-Free Rate 3.00% (A) Please calculate this portfolio's Sharpe Ratio. (B) Please calculate this portfolio's Treynor Ratio. (C) Based on the above, should you change the amounts you have invested in Fund A and Fund B (keeping your total investment at $25,000). Why or why not?

Answer rating: 100% (QA)

Portfolio Analysis A Sharpe Ratio Calculate Portfolio Expected Return Rp We can calculate the weight... View the full answer