The Sharpe's Measure for Jane Smith's Investment Portfolio Is 0

question 31

Multiple Choice

The Sharpe's measure for Jane Smith's investment portfolio is 0.40, while the Sharpe's measure for the market is 0.30. This information suggests that Smith's portfolio

• A) is overly diversified, and some securities should be sold to bring the portfolio in line with the market.
• B) exhibits superior performance because its risk premium per unit of risk is above that of the market.
• C) is inadequately diversified, and more securities should be added to the portfolio in order to bring it in line with the market.
• D) exhibits poor performance because its risk premium per unit of risk is below that of the market.

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Definitions:

Community Vehicles

Definition: Tools or platforms used to engage, mobilize, and connect members of a specific community or group towards shared goals or interests.

Social Engagement

Social engagement refers to the ways in which individuals interact with each other and participate in community or social activities, often facilitated by digital platforms.

Network Structure

The arrangement of components (nodes and links) within a network, defining how they are interconnected.

Decentralization

The distribution of power, authority, or functions from a central authority to smaller units or individuals, fostering diversity and potentially enhancing efficiency.