Question 4 [15 marks in total] Consider the following performance data for portfolio P that is managed by Peter and a common benchmark portfolio, B: I Weight Portfolio, P Benchmark, B 0.500 0.400 Asset Class Stock (1) Bond (2) Cash (3) Return Portfolio, P Benchmark, B 4.00% 3.80% 2.60% 2.80% 0.70% 0.50% 0.550 0.400 0.050 0.100 a) Calculate: (1) the overall return to the benchmark portfolio and (2) the overall return to Portfolio P. Briefly comment on whether Peter has under- or outperformed the benchmark portfolio and by how much. (6 marks) I b) Using attribution analysis, calculate (1) the allocation effect and (2) the selection effect for Peter. (4 marks) I c) Please comment on Peter's decision to underweigh stocks, overweigh bond and underweigh cash relative to the overall return to the benchmark