$[$The following information applies to the questions displayed below.$]$

Part $3$ of $3$

A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long$-$term government and corporate bond fund, and the third is a T$-$bill money market fund that yields a sure rate of $5\mathrm{.}5\%.$ The probability distributions of the risky funds are:

$10$

points

Stock fund $($S$)$

Bond fund $($B$)$

Expected Return

$16\%$

$10\%$

$*$The correlation between the fund returns is $0\mathrm{.}10.$

Standard Deviation

$36\%$

$27\%$

Required:

What is the Sharpe ratio of the best feasible CAL?$($Do$$not$$round