. Suppose that the actual returns for Portfolios 1, 2, and 3 were as follows:

Portfolio 1 11.3

Portfolio 2 12.5

Portfolio 3 9.4

Also assume that the risk-free rate was 5.5 percent and the average return on the market portfolio was 8 percent.

a. Which of the three portfolios has the highest Jensens alpha? Show your work.

b. Which has the highest Treynor ratio? Show your work.

Portfilio 1
Security	Amount Invested	Expected Return	Beta
Security A	$4000	9%	.80
Security B	$5000	12%	1.15
Security C	$12000	14%	.95
Security D	$8000	15%	1.23
Portfolio 2
Security A	$3000	16%	1.22
Security B	$11000	13%	1.54
Security C	$9000	8%	.87
Security D	$6000	11%	.81
Portfolio 3
Security A	$15000	10%	1.72
Security B	$12000	9%	.81
Security C	$3000	12%	.72
Security D	$2000	15%	1.54