Question
The annual returns for three portfolios are shown in the following exhibit. Portfolios P and R were created in Year 1, Portfolio Q in Year
The annual returns for three portfolios are shown in the following exhibit. Portfolios P and R were created in Year 1, Portfolio Q in Year 2.
| Annual Portfolio Returns (%) | |||||
|---|---|---|---|---|---|
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
| Portfolio P | 3.0 | 4.0 | 5.0 | 3.0 | 7.0 |
| Portfolio Q | 3.0 | 6.0 | 4.0 | 8.0 | |
| Portfolio R | 1.0 | 1.0 | 4.0 | 4.0 | 3.0 |
The median annual return from portfolio creation to Year 5 for
| Portfolio P is 4.5% | ||
| Portfolio R is less than its arithmetic mean annual return | ||
| Portfolio R is higher than its arithmetic mean annual return | ||
| Portfolio Q is 4.0% |
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Principles Of Quantitative Equity Investing
Authors: Sugata Ray
1st Edition
0134878450, 978-0134878454
