A Managed Portfolio Has a Standard Deviation Equal to 22

question 78

Multiple Choice

A managed portfolio has a standard deviation equal to 22% and a beta of 0.9 when the market portfolio's standard deviation is 26%.The adjusted portfolio P* needed to calculate the M² measure will have ________ invested in the managed portfolio and the rest in T-bills.

• A) 84.6%
• B) 118%
• C) 18%
• D) 15.4%

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Definitions:

Insincere

Characterized by a lack of genuineness or honesty in expression; not expressing genuine feelings.

Trustworthiness

The ability to be relied on as honest or truthful.

Ingratiation

A psychological technique involving deliberate efforts to win someone's favor or to make oneself appear more likable to others.

Interpersonal Rewards

Benefits or positive outcomes that arise from social interactions, including emotional support, companionship, and shared activities.