What Is Jensen's Alpha of a Portfolio Comprised of 45

question 13

Multiple Choice

What is Jensen's alpha of a portfolio comprised of 45 percent portfolio A and 55 percent of portfolio B?
The risk-free rate is 3.1 percent and the market risk premium is 6.8 percent.

• A) −1.25 percent
• B) 0.47 percent
• C) 1.08 percent
• D) 1.46 percent
• E) 2.04 percent

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Definitions:

Cochlea

Inner ear structure containing the auditory receptor cells.

Inner Ear

A complex structure in the ear responsible for hearing and balance, comprising the cochlea, vestibule, and semicircular canals.

Depolarization

Decrease in electrical charge across a membrane, usually due to the inward flow of sodium ions.

Hyperpolarization

Increase in electrical charge across a membrane, usually due to the inward flow of chloride or sodium ions or the outward flow of potassium ions.