Elsie is an investor considering investing in an actively managed equity fund. The Fund has a return of 8%; the risk-free rate was 2% and the market portfolio returned 8%. The Fund had a target Beta of 1.40, but was actually 1.30. The fund had a standard deviation of 20%, and the market had a standard deviation of 12%.    Calculate - Sharpe ratio  Calculate - Treynor Ratio

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Q: You manage an equity fund with an expected risk premium of 10% and an expected standard deviation of…

A: Expected Return of Equity = E(Ri) = Rf + ß * (Rm – Rf)

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A: As per CAPM, Expected Return = Risk free rate + beta * (Market return - Risk free rate)

Q: You are managing a fund with an expected rate of return of 15% and a standard deviation of 27%. The…

A: A mixture of different kinds of funds and securities for the investment is term as the portfolio.

Q: Elsie is an investor considering investing in an actively managed equity fund. The Fund has a return…

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Q: You manage an equity fund with an expected risk premium of 8% and an expected standard deviation of…

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Q: Suppose you are the money manager of a $4.07 million investment fund. The fund consists of four…

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A: Calculation of Sharpe and Treynor ratio using excel is as follows:

Q: Suppose you are the money manager of an Rs.8 million investment fund. The fund consists of 4 stocks…

A: Stock Portfolio Beta- = XaBa+ XbBb+ XcBc+ XdBd = (800,000/ 8,000,000)(1.2)+ (1200,000/…

Q: 1. What is the required rate of return on the initial P20M investment?   2. What is the rate of…

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Q: In addition to risk-free securities, you are currently invested in the Tanglewood Fund, a…

A: The computation of the required return is done as:

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A: The formula used is shown:

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Q: Suppose you are the money manager of a $4.94 million investment fund. The fund consists of four…

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A: Cov (S,B) is calculated as follows:

Portfolio Management

Portfolio management is the process by which an investor decides that how the person will invest in a variety of assets in order to get a desired return in the future. A portfolio means a pool of assets that includes securities, bonds, and other investment instruments which helps in risk minimization of the money that has been invested. In other words, it can be said that a portfolio means a combination of assets in which an investor decides to invest their money in order to get a lump sum return in the future or even a series of cash flow that the person is expecting at the end of their job life.