$1)$ Sharpe Ratio $(20$ points$)$:

i$)$ Similar to what we did in class, please use the Nasdaq Index data $($FIN $443$ S$24$ Sharpe Data$)$ provided

to calculate the Sharpe Ratio. Assume that the risk free rate is the $1-$Year treasury rate of $4\mathrm{.}5\%.$ Please

provide the following components of your calculation as well as attach your excel sheet, round to at least

two decimals:

Monthly Volatility

Monthly Return

Annualized Volatility

Annualized Return

Sharpe Ratio

iii$)$ If you were an active asset manager, would you want to invest solely in the Nasdaq based on this

Sharpe Ratio? Why or why not? $(4$ pts$)$

iv$)$ Why do we subtract the US rate from the average return assuming this is the equivalent of the US $1$ yr

Treasury $(4$ points$)?$

v$)$ When converting daily to annualized return what conversion formula do you use? For converting

volatility what formula do you use $(4$ points$)?$