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funds. Assume deviation of the company stock will be 15 percent and 65 percent, respectively. Calculate the Sharpe ratio for the company stock. How
funds. Assume deviation of the company stock will be 15 percent and 65 percent, respectively. Calculate the Sharpe ratio for the company stock. How appropriate is the Sharpe ratio for these assets? When would you use the Sharpe ratio? Assume the risk-free rate was 2.76 percent. Bledsoe S&P 500 Index Fund Bledsoe Small-Cap Fund Bledsoe Large-Company Stock Fund Bledsoe Bond Fund 10-Year Annual Return Standard Deviation 11.85% 23.85% 15.32 29.62 10.73 26.73 8.04 10.34 6. What portfolio allocation would you choose? Why? Explain your thinking carefully.
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