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Sharpe's RVAR Measures the Slope of the Line Between RF

question 38

Essay

Sharpe's RVAR measures the slope of the line between RF and the portfolio being evaluated.If the line is plotted between RF and a market index,where would superior portfolios lie? Inferior portfolios?


Definitions:

Defined Benefit Plans

A retirement plan where employee benefits are calculated using a formula that considers factors such as salary history and duration of employment.

Deferred Profit-sharing Plans

A type of retirement plan in which employees receive a share of the company's profits at a future date, typically upon retirement.

Contributory Benefits

Benefits, typically related to pension or insurance, that require contributions from both the employee and the employer.

Indirect Pay System

A compensation approach that includes non-wage benefits provided to employees, such as health insurance, retirement plans, and paid time off.

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