1. You are assessing the performances of two stocks in the recent past:

Fund A Fund B

Five-year annual returns: 12% 13% Standard deviation 12% 10% Risk-free rate in respective countries 3% 5%

On a risk-adjusted basis, using the Sharpe ratio, which manager performed better?

		Fund A because the Sharpe ratio is 0.75
		Fund B because the Sharpe ratio is 0.75
		Fund A because the Sharpe ratio is 0.80
		Fund B because the Sharpe ratio is 0.80