The Mean and Standard Deviation (SD)of Monthly Returns,over a Given

question 61

Multiple Choice

The mean and standard deviation (SD) of monthly returns,over a given period of time,for the stock markets of two countries,X and Y are: $$\begin{array} { | c | c | c | } \hline \text { Countr) } & \text { Mean(\%) } & \text { SD(\%) } \\\hline \mathrm { X } & 1.57 & 4.87 \\\hline \mathrm { Y } & 1.92 & 7.64 \\\hline\end{array}$$ Assuming that the monthly risk-free interest rate is 0.25 percent,the Sharpe performance measures,SHP(X) and SHP(Y) ,and the performance ranks,respectively,for X and Y are:

• A)SHP(X)= 0.271,rank = 1,and SHP(Y)= 0.219,rank = 2.
• B)SHP(X)= 0.271,rank = 2,and SHP(Y)= 0.219,rank = 1.
• C)SHP(X)= 18.84,rank = 1,and SHP(Y)= 23.04,rank = 2.
• D)SHP(X)= 23.04,rank = 2,and SHP(Y)= 18.84,rank = 1.

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Definitions:

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A preliminary version of a product designed based on the feedback and requirements of its intended users to meet their specific needs.

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Experimentation

The process of trying out new ideas, concepts, or methods to gain insights or achieve improvements.