Answer the below questions.
(a) Compute the tracking error from the following information:

(b) Is the tracking error computed in part (a) a backward-looking or forward-looking tracking error?
(c) Compare the tracking error found in part (a) to the tracking error found for Portfolios A and B in Exhibits 25-1 and 25-2. What can you say about the investment management strategy pursued by this portfolio manager?

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Month 2001 January February March April May June July August September October November December Portfolio A's Return (%) 2.15 0.89 1.15 -0.47 1.71 0.10 1.04 2.70 0.66 2.15 1.38 -0.59 Lehman Aggregate Bond Index Retum (%) 1.65 -0.10 0.52 -0.60 0.65 0.33 2.31 1.10 1.23 2.02 -0.61 1.20