Question
Assume that you manage a risky portfolio with an expected rate of return of 20% and a variance of 25%. The risk-free rate is 5%.
Assume that you manage a risky portfolio with an expected rate of return of 20% and a variance of 25%. The risk-free rate is 5%. Your client chooses to invest $12,000 in your fund and $8,000 in risk-free asset. What is the reward-to-variability ratio of your clients overall portfolio?
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Financial Markets And Institutions
Authors: Anthony Saunders, Marcia Cornett
8th Edition
1264098723, 978-1264098729
