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Security A has an expected return of 0.325% and a standard deviation of 5.644%. Security B has an expected return of 0.338% and a standard
Security A has an expected return of 0.325% and a standard deviation of 5.644%. Security B has an expected return of 0.338% and a standard deviation of 6.305%. Which security is preferred based on Sharpe Ratio? Assuming risk free rate of 0.09%.
A) Security A is preferred because of its lower standard deviation
B) Security A is preferred because it has a higher Sharpe Ratio
C) Security B is preferred because of its higher return
D Indifferent because both securities have the same Sharpe Ratio
E) Not enough information to decide
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