The Sortino Measure Differs from the Sharpe Ratio in That

question 92

Multiple Choice

The Sortino measure differs from the Sharpe ratio in that

• A) It measures the portfolio's average return in excess of a user-selected minimum acceptable return threshold.
• B) It measures the downside risk in a portfolio.
• C) Higher values of the Sortino measure are not desirable, while higher values in the Sharpe ratio are desirable.
• D) Both a and b
• E) All of the above.

---

Definitions:

Compounded Quarterly

A method of calculating interest where the interest is added to the principal four times a year, leading to a faster growth rate of the investment or loan due to the compounding effect.

Business Offers

Proposals or bids made by companies or individuals in the context of business transactions, which can include prices, terms, and conditions for services or products.

Compounded Quarterly

Compounded quarterly refers to the method of calculating interest where the interest earned or paid is compounded four times a year.

Lump Sum Payment

A large, one-time payment made for a particular item or service, rather than breaking the payment into smaller installments.