An actively managed portfolio on Canadian energy stocks has achieved a 32% return this past year with a volatility of 48%. By comparison, the portfolios benchmark, the S&P/TSX Energy Index returned 22% with a volatility of 35%. The risk-free rate during this time was 1%.

1. Assuming normally distributed returns and a single-index model with the benchmark as the single factor, calculate the information ratio of the active portfolio (2 marks)