The Following Is Return Data for a Retail Sector ETF

question 46

Essay

The following is return data for a Retail sector ETF and Energy Sector ETF for the years 2007 through 2011. a.What is the arithmetic mean return for each ETF?
B)What is the geometric mean return for each ETF?
C)What is the sample standard deviation for each ETF? Which ETF was riskier over this time period?
D)Given a risk free rate of 5%.What is the Sharpe Ratio for each ETF? Which investment had a better return per unit of risk over this time period?

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Definitions:

Conglomerate Company

A Conglomerate Company is a large corporation composed of several companies with diverse or unrelated business interests.

Horizontal Merger

The combination of two or more firms operating in the same industry and at the same stage of production.

Vertical Merger

A merger between two companies that operate at different levels in the production process of the same industry.

Small Business

An independently owned and operated company that is limited in size and revenue, depending on the industry.