Question $6$

$2$ pts

Consider two investors who form efficient portfolios on the Capital Market Line. Investor A is risk averse, and has a long position in both the risk$-$free asset and the optimal risky portfolio. Investor B is risk$-$seeking, and borrows to take a leveraged position in the optimal risky portfolio. If the borrowing rate, $r_B,$ is greater than the risk$-$free rate, $r_f,$ then the following relationship will hold:

Sharpe ratio for $A$ Sharpe ratio for $B$

Not enough information to tell.

Sharpe ratio for $A=$ Sharpe ratio for $B$

Sharpe ratio for $A>$ Sharpe ratio for $B$