QUESTION 3 (10 MARKS) A portfolio manager is analysing the performance of an equity portfolio, Portfolio A. The portfolio and the benchmark returns over the past 12 months are given in the following table: Month 1 2 Portfolio return (%) 2.525 -0.824 2.750 3.375 3 4 5 2.575 Benchmark return (%) 2.275 1.550 1.725 1.775 1.675 1.275 0.175 2.625 2.525 -0.750 0.389 6 2.325 7 8 9 -0.278 2.125 2.275 -1.825 4.650 2.575 10 11 12 2.425 Hint: show all calculations when answering the following questions. Round off your final answers to two (2) decimal places. 3.1 Calculate and interpret the portfolio manager's information ratio. (9) 3.2 A similar portfolio, Portfolio B, also uses the same benchmark as Portfolio A. The information ratio for Portfolio B is 0.15. Justify which portfoliomanager performed better. (1 )