A Portfolio Has a Treynor Ratio of

question 1

Multiple Choice

A portfolio has a Treynor ratio of .068, a standard deviation of 16.40 percent, a beta of 1.16, and an expected return of 14.3 percent. What is the risk-free rate?

• A) 1.32 percent
• B) 5.21 percent
• C) 5.39 percent
• D) 6.18 percent
• E) 6.41 percent

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Definitions:

Dividends

Payments made by a corporation to its shareholder members. It is the portion of corporate profits paid out to stockholders.

Net Income

The total profit of a company after all expenses and taxes have been deducted from revenue, indicating the company's bottom line.

Financial Statements

Formal records of the financial activities and position of a business, person, or other entity, typically including the balance sheet, income statement, and cash flow statement.

Dividends Paid

Payments made by a corporation to its shareholder members, usually derived from the company's earnings.