ESSEN.OF.INVESTMENTS+CONNECT
ESSEN.OF.INVESTMENTS+CONNECT
10th Edition
ISBN: 9781260361605
Author: Bodie
Publisher: MCG
Question
Book Icon
Chapter 18, Problem 16PS
Summary Introduction

(a)

To calculate:

The sharpe ratios for the fund and index i.e. Miranda fund and S&P 500 .

Introduction:

Sharpe ratio is a ratio which helps in computing the reward-to-volatility ratio. This ratio gives an understanding of the incremental return which an investor will expect to earn on every 1% increase in the value of standard deviation.

Summary Introduction

(b)

To calculate:

The M2 measure for the fund and index i.e. Miranda fund and S&P 500

Introduction:

  M2 is a measure which helps in ascertaining the adjusted return in regard to the associated risk with the portfolio.

Summary Introduction

(c)

To calculate:

The treynor ratios for the fund and index i.e. Miranda fund and S&P 500 .

Introduction:

Treynor ratio is a ratio which helps in computing the reward-to-volatility ratio. This ratio provides excess return over expected in regard to systematic risk i.e. beta.

Summary Introduction

(d)

To calculate:

The Jensen measure i.e. alpha for the fund i.e. Miranda fund.

Introduction:

The alpha shows the performance of portfolio in relation to benchmark.

Blurred answer
Knowledge Booster
Background pattern image
Recommended textbooks for you
Text book image
Essentials Of Investments
Finance
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Mcgraw-hill Education,
Text book image
FUNDAMENTALS OF CORPORATE FINANCE
Finance
ISBN:9781260013962
Author:BREALEY
Publisher:RENT MCG
Text book image
Financial Management: Theory & Practice
Finance
ISBN:9781337909730
Author:Brigham
Publisher:Cengage
Text book image
Foundations Of Finance
Finance
ISBN:9780134897264
Author:KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:Pearson,
Text book image
Fundamentals of Financial Management (MindTap Cou...
Finance
ISBN:9781337395250
Author:Eugene F. Brigham, Joel F. Houston
Publisher:Cengage Learning
Text book image
Corporate Finance (The Mcgraw-hill/Irwin Series i...
Finance
ISBN:9780077861759
Author:Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:McGraw-Hill Education