Consider the Sharpe and Treynor Performance Measures

question 27

Multiple Choice

Consider the Sharpe and Treynor performance measures.When a pension fund is large and well diversified in total and it has many managers,the __________ measure is better for evaluating individual managers while the __________ measure is better for evaluating the manager of a small fund with only one manager responsible for all investments that may not be fully diversified.

• A) Sharpe; Sharpe
• B) Sharpe; Treynor
• C) Treynor; Sharpe
• D) Treynor; Treynor

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Definitions:

Indorsed in Blank

Pertains to a signature on a financial instrument, such as a check, without specifying a payee, allowing any holder to cash or transfer it.

Negotiation

The process by which two or more parties attempt to settle their differences or reach an agreement through discussion and compromise.

Accidental

An unexpected and unintentional event that causes damage or injury.

Indorser

An alternative spelling of "endorser," referring to a person who signs a document (often a negotiable instrument) to endorse it, thereby assuming responsibility under certain conditions.