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(a) Calculate the reward-to-risk ratios for each of the ETFs. Exhibit 1. Annualised ETF Return and Risk ETF SPDR STI (STI) ABF SG BOND (ABF)
(a) Calculate the reward-to-risk ratios for each of the ETFs.
Exhibit 1. Annualised ETF Return and Risk ETF SPDR STI (STI) ABF SG BOND (ABF) SPDR S&P 500 (S&P) iShares Core US Aggregate Bond (AGG) Asset class Equities Fixed Income Equities Fixed Income Country SG SG US US Return Std Dev 2.51% 18.50% 2.42% 6.70% 8.94% 15.71% 3.60% 4.02% Correlations STI ABF S&P AGG STI 1.00 0.20 0.78 0.22 ABF 0.20 1.00 0.10 0.52 S&P 0.78 0.10 1.00 0.09 AGG 0.22 0.52 0.09 1.00 Exhibit 2. Candidate Portfolios ETF SPDR STI (STI) ABF SG BOND (ABF) SPDR S&P 500 (S&P) iShares Core US Aggregate Bond (AGG) Portfolio A B C $ XXX $ 140,000 $ 105,000 $ 140,000 $ 70,000 $ 70,000 $ 210,000 $ XXX $ XXX $ 70,000 $ 140,000 $ 70,000 Standard Deviation 11.86% 11.26% 12.66%Step by Step Solution
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