Question
A highly risk averse investor with an investment strategy of minimizing risk has to choose one of the two stocks, stock A, or stock B.
A highly risk averse investor with an investment strategy of minimizing risk has to choose one of the two stocks, stock A, or stock B. Based on information of characteristics of each of the stocks as shown below, identify which stock should be optimal for the investor and explain why.
| Stock | Risk Premium | Sharpe Ratio |
| A | High | Low |
| B | Low | High |
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Personal Finance For Musicians
Authors: Bobby Borg
1st Edition
1538163306, 978-1538163306
