Question: You have been given the following return information for two mutual funds (Papa and Mama), the market index, and the risk-free rate. (25 points) Year
- You have been given the following return information for two mutual funds (Papa and Mama), the market index, and the risk-free rate. (25 points)
| Year | Papa Fund | Mama Fund | Market | Risk-Free |
| 2015 | -12.6% | -22.6% | -24.5% | 1% |
| 2016 | 25.4 | 18.5 | 19.5 | 3 |
| 2017 | 8.5 | 9.2 | 9.4 | 2 |
| 2018 | 15.5 | 8.5 | 7.6 | 4 |
| 2019 | 2.6 | -1.2 | -2.2 | 2 |
- What is the Sharpe ratio for both fund? (4 points)
- What is the Treynor ratio for both fund? (4 points)
- What is the Jensens alpha for both fund? (4 points)
- What is the information ratio for both fund? (4 points)
- What is R-squared for both fund? (4 points)
- Which is the best choice for your portfolio? (5 points)
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
