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Assume the following information over a five-year period: Average risk free rate = 6% Average return for Crane stock = 11% Average return for Load
Assume the following information over a five-year period:
Average risk free rate = 6%
Average return for Crane stock = 11%
Average return for Load stock = 14%
Standard deviation of Crane Stock returns = 2%
Standard deviation of Load stock returns = 4%
Beta of Crane stock = 0.8
Beta of Load stock = 1.1
Determine which stock has higher risk adjusted returns when using the Sharpe index. Which stock has higher risk adjusted returns when using the Treynor index?
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